Sovereign statutory fees are not taxable consideration where a State officer collects charges for forest conservation duties.

Fees collected by a State officer in discharge of sovereign forest-management and conservation duties, and credited to the State's consolidated fund, do not amount to consideration for a taxable commercial service. The activity was treated as a statutory and sovereign function rather than a private tour operator service, so the central service tax levy could not be applied to the permit, entry and allied charges collected in that capacity. The consequential penalty was also unsustainable, and the demand failed.

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Issues: Whether the respondent, an officer of the State Government, could be treated as a "tour operator" and subjected to service tax on fees collected in the course of performing conservation-related statutory duties.

Analysis: The respondent collected permit fees, entry fees and allied charges in his official capacity for management and conservation of the forest area. The receipts were collected on behalf of the State Government and credited to the State's consolidated fund. The activity was held to be a sovereign and statutory function of the State, not a private commercial operation undertaken for taxable consideration. On that basis, the levy of service tax and the consequential penalty were found to be without jurisdiction, and the Central levy could not be applied to such State-collected statutory charges.

Conclusion: The respondent was not liable to service tax as a "tour operator", and the demand and penalty were unsustainable; the appeal failed.

Ratio Decidendi: Fees collected by a State officer in discharge of sovereign statutory functions, and credited to the State's consolidated fund, do not constitute consideration for a taxable service and cannot be subjected to service tax under a central levy.

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