Query on Rent a ceb service

[Sumeet Tholle]

Dear Sir,

My client who is hotel also arranges vehicles from outside for their customers.

He charge fix rate vehicle wise for Airport/Railway station pickup and drop.

Along with this, he charges vehicle wise at fixed rates to visit Ellora, Ajanta or near by places.

In fact, he has prepared vehicle wise/place wise chart of charges.

Now, department demanding Service Tax under 'Rent a Cab service' for Period April 2008 to March 2012 which we have never charged to our customer.

Is this 'rent a cab' service.

We are relying on following judgement,

1. Surya Tours and Travels Vs CCE (2009) 19 STT 147 = 2008 (10) TMI 123 - CESTAT, NEW DELHI

2. Sri Sai Krishna Travels Vs CCE (2010) 24 STT 245= 2009 (9) TMI 515 - CESTAT, BANGALORE

Pl. Guide.

Thanks and Regards

Sumeet C. Tholle, CA.

[YAGAY andSUN]

Dear Sumeet,

We are afraid that the judgments you are referring have been overruled by the following two High Courts, namely:-

1. Hon'ble Punjab and Haryana High Court.
2. Hon'ble Madras High Court.

Please also check the profile of Rent-a-cab service w.e.f. 2008 that whether there was any change made in this service or not?

Regards,

YAGAY and SUN

(Management and Indirect Tax Consultants)

AI Summary

Rent a cab service classification may attract service tax for fixed hotel-arranged vehicle charges despite prior tribunal precedents. Whether hotel charges for arranging vehicles at fixed vehicle/place-wise rates for pickups, drops and sightseeing constitute rent a cab service liable to service tax for April 2008-March 2012, noting the hotel did not charge service tax and relied on tribunal decisions, but later High Court rulings may have overruled those precedents requiring review of the rent a cab service profile effective 2008.