2014 (12) TMI 240

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....ersons and operate their activity in two categories :- (i)      Stage Carriage :- Transport of passengers on a specified route wherein the individual passenger pays fare either for the whole journey or for the stages of journey. This is a foremost activity of the Corporation. (ii)    Contract Carriage :- Buses are provided on Hire/Lease under a Round Trip Contract or a Drop Contract wherein the entire vehicle is provided based on seat capacity, route, pick-up place and final destination specified in the contract. They have given the nature of occasions, wherein the buses are let out on hire - (a)      Marriages (b)      Educational Purpose (c)      General or local election/poll - for transportation of personnel deputed by Election Commission/local authority for conducting the Poll. (d)     Transportation of police force in event of riots, visits by MPs, MLAs, politicians, etc. (e)      Transportation of injured railway passengers in case of accidents. 3. The dispute is whether contract carriage ....

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....ded. Thus, before 2008, on this ground alone, they are not liable to pay Service Tax. 7. The learned AR, on the other hand, stated that in view of the definition in the statute and in view of the Hon'ble Madras High Court's decision in the case of Secy. Federn. of Bus-operators Assn. of T.N. v. UOI reported in 2001 (134) E.L.T. 618 (Mad.) = 2006 (2) S.T.R. 411 (Mad.), which has been upheld by the Hon'ble Supreme Court as reported in 2003 (157) E.L.T. A144 (S.C.), the assessee is liable to pay Service Tax. The learned AR further quoted the Hon'ble Madras High Court's judgment in the case of Sri Pandyan Travels v. CCE, Chennai-II reported in 2006 (3) S.T.R. 151 (Mad.) = 2004 (163) E.L.T. 409 (Mad.) and the Tribunal's decision in the case of Parveen Travels (P) Ltd. v. CST, Chennai reported in 2008 (11) S.T.R. 357. He also quoted this Tribunal's decision in the case of CCE, Nasik v. Mrs. Cynthia Rebello in Appeal Nos. ST/159-161/2007, wherein the Tribunal has given the judgment favourable to the Revenue. The learned AR stated that in view of the latest judgment, the appeals of the department be allowed and that of the assessee be dismissed. 8. We have given considerabl....

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....9-2004. 10. It will be important to see how the 'tourist vehicle' is defined under the Motor Vehicles Act, 1988. Section 2(43) of the Motor Vehicles Act defines a tourist vehicle as follows :- " 'Tourist vehicle' means a contract carriage constructed or adapted and equipped and maintained in accordance with such specifications as may be prescribed in this behalf." Further, the specification for the tourist vehicle is prescribed under Rule 128 of the Central Motor Vehicles Rules. Thus to charge Service Tax, the vehicle used for operating tours must meet the said specifications. 11. Since the definition of 'tourist vehicle' contains a further term i.e. 'contract carriage', it will be important to understand the definition of 'contract carriage'. 'Contract carriage' has been defined under Section 2(7) of the Motor Vehicles Act as under :- " "Contract carriage" means a motor vehicle which carries a passenger or passengers for hire or reward and is engaged under a contract, whether expressed or implied, for the use of such vehicle as a whole for the carriage of passengers mentioned therein and entered into by a person with a holder of a permit in relation to suc....

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....ns for a vehicle being recognised as a 'tourist vehicle' under Section 2(43). We can conveniently refer to Rule 128 of the Motor Vehicles Rules, which provides the conditions for a tourist vehicle other than motor cabs, maxi-cab, camper's van, house trailer which a tourist vehicle shall conform to. Number of specifications are given in that rule in respect of dimension, structure, door arrangement, ventilation, luggage space, seating arrangement, painting and furnishing, lighting, fitting and accessories, etc. In short, Rule 128 specifies the standard of comforts which are required to be there in a vehicle for being recognised as the 'tourist vehicle' under the Central Motor Vehicles Rules. We have, therefore, no hesitation first to hold that the first and foremost condition for a person to be held as a 'tour operator' within the meaning of Section 65(52) of the Finance Act is that he must be engaged in the business of operating tours in a 'tourist vehicle' in terms of Section 2(43) of the Motor Vehicles Act and in no other type of vehicle and, therefore, necessarily such vehicle must conform to the conditions prescribed under Rule 128 of the Central Motor Vehicles Rules." The H....