service tax on taxi charges

[hubert fernandes]

we pay taxi charges fir plying our customers . These taxi are metered cab, would be liable to pay service tax under reverse charges on such charges paid

[Ganeshan Kalyani]

Sir service tax is not applicable on taxi charges. Thanks.

[hubert fernandes]

sir what if is the the implication if the motor vehicle used for transporting of passenger/s is not a metered tax or if it is a contract carriage it is air conditioned, whether in such a situation the service tax is required to be paid by the business entity.

[KASTURI SETHI]

Sh.Hubert Fernandes,

Sir, Pl. go through serial no.7 (a) & (b) of Notification No.30/12-ST dated 20.6.12 as amended vide Notification No.10/14-ST dated 11.7.14. This service is taxable and also under RCM.

[KASTURI SETHI]

Sh. Hubert Fernandes,

Sir, I think there must be some agreement between the owner of the metered cab and the Company which provides customer to the owner of the cab. Am I right ? If so, the issue will be examined from another prospective. Pl. reply now.

[Ganeshan Kalyani]

Sri Kasturi Sir, in my view radio taxi is taxable but metered taxi is exempt. OLA, Uber are radio taxi and the cab which has meter given by state transport is a metered cab. Am I right Sir?

[KASTURI SETHI]

Sh.Ganeshan Kalyani Ji,

You are 100% right. Radio Taxi became taxable w.e.f. 1.10.14 under Section 66 D (o) (vi). It was omitted from negative list w.e.f. 1.10.14. Metered cabs or auto rickshaw have remained in negative list since 1.7.12.

[KASTURI SETHI]

Sh.Hubert Fernandes,

Pl. refer to your query dated 7.5.16 regarding non-air-conditioned contract carriage and air-conditioned contract carriage. Non-air-conditioned contract carriage is exempted vide Notification No.9/16-ST dated 1.3.16 and air-conditioned contract carriage is taxable w.e.f.1.6.16 vide Notificatin No.8/16-ST dated 29.2.16/1.3.16

[Ganeshan Kalyani]

Thanks Sri Kasturi Sir for validating my views Thanks.

[KASTURI SETHI]

Sh.Ganeshan Kalyani Ji,

Our replies on the issue are closed. For knowledge sake, now I am sharing a case law on 'RADIO TAXI' with you, other experts and those visitors of this site who are anyhow deal with Radio Taxi. The case law is very important and can be useful in your profession of consultancy. It is as under:-

MERU CAB CO. PVT. LTD. Versus COMMISSIONER OF C. EX., MUMBAI-II -2015 (11) TMI 834 - CESTAT MUMBAI
 

[hubert fernandes]

Thanks for the valuable reply

AI Summary

Service tax on taxi services: radio taxi fares taxable while metered cab charges remain exempt under the negative list.
Metered cabs and auto rickshaws are exempt from service tax under the negative list. Radio taxi services were omitted from the negative list and are taxable, and the service is subject to the reverse charge mechanism per relevant notifications. Non-air-conditioned contract carriage is exempt by notification, while air-conditioned contract carriage is rendered taxable by a subsequent notification. A tribunal decision concerning a radio taxi operator is noted for reference.