ST on engaging a State Corporation Bus on tourinsm purpose

[P S SATYA NARAYANA]

Dear Sir,

We are a Public Limited Company.  Recently we have engaged a State Road Transport Corporation Bus for our employees to go to Goa on a Tour.  Whether the above activity attracts Service Tax and we need to pay it under Reverse Charge

AI Summary

Service Tax on tourism bus hire remains payable by the provider; reverse charge not attracted against a state corporation.
Transport of passengers by contract carriage for tourism is taxable. Because the supplier is a State Road Transport Corporation and not an individual, HUF, partnership firm or association of persons, the Reverse Charge mechanism does not apply; the service provider must collect and remit the Service Tax.