Service tax notice defects and tourist vehicle specifications determine whether demand, penalty, and tour operator liability can stand.

Service tax demand and penalty cannot be sustained where the show cause notice omits both the period of demand and the quantified tax liability, because such defects go to the root of the proceedings. Liability as a tour operator also depends on the vehicle satisfying the prescribed tourist vehicle specifications under the relevant motor vehicle law; where the record shows non-conformity, the classification fails and no such liability arises. The impugned order was set aside, with consequential relief granted.

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Issues: (i) Whether service tax demand and penalty could be sustained when the show cause notices did not specify the period of demand or quantify the tax liability; (ii) Whether the vehicle in question satisfied the statutory specifications of a tourist vehicle so as to render the appellants liable as tour operators.

Issue (i): Whether service tax demand and penalty could be sustained when the show cause notices did not specify the period of demand or quantify the tax liability.

Analysis: The notices issued in 2002 and 2005 neither quantified the service tax liability nor specified the period for which the demand was raised. A demand cannot be confirmed in vacuum when the liability itself is not properly set out in the notice. On the facts, the deficiency in the notice went to the root of the proceedings.

Conclusion: The demand and penalty were not sustainable on this ground.

Issue (ii): Whether the vehicle in question satisfied the statutory specifications of a tourist vehicle so as to render the appellants liable as tour operators.

Analysis: Liability as a tour operator depended upon the vehicle satisfying the specifications prescribed for a tourist vehicle under the relevant motor vehicle law. The RC book and the material on record showed that the vehicle did not conform to those specifications. The statutory requirement was treated as essential for such registration and classification.

Conclusion: The appellants were not liable to be treated as tour operators.

Final Conclusion: The impugned order was set aside and the appeal was allowed with consequential relief.

Ratio Decidendi: A service tax demand cannot be sustained unless the show cause notice clearly sets out the period and quantified liability, and tour operator liability cannot arise unless the vehicle satisfies the prescribed tourist vehicle specifications.

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