TaxTMI 
TaxTMI 
2015 (12) TMI 1448
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....n merits. 3. Heard both sides and perused the records. 4. The issue involved in this case is regarding whether the appellant-asessee who was entered into a contract of hiring of vehicles falls under the category of "Rent-a-Cab scheme operator" is liable for service tax under the category of "Rent-a-Cab Service" or otherwise. 5. It is the case of the assessee that the appellant had under a contract with Bharat Sanchar Nigam Ltd. (BSNL) for supply of the vehicles within the jurisdiction of Amravati District and they were required to supply the vehicles on hiring basis. It is the submission of the learned Counsel that the issue is no more res integra as the Hon'ble High Court of Uttrakhand in the case of CC & CE v. Sachin Malhotra....
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....t was called on to decide the question of law on the issue whether hiring of vehicles would fall under the category of Rent-a-cab scheme operator" or otherwise. Their Lordships had after going into details as to what is Rent-a-Cab scheme operator, in paragraphs 16, 17 and 18 held as under: "16. What is sought to be taxed under the provisions, which we have adverted to in this judgment, is service, which is rendered in relation to renting of cabs. Under Section 65(91) of the Service Tax Act, "rent-a-cab scheme operator" has been defined as a person, who is engaged in the renting of cabs. The words "in relation to", undoubtedly, do have the effect of expanding the scope of taxation. With this proposition, we can have no quarrel. But,....
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.... motor cycles for their own use and for matters connected therewith . (2) A scheme made under sub-section (1) may provide for all or any of the following matters, namely;- (a) licensing of operators under the scheme including grant, renewal and revocation of such licence; (b) form of application and form of licences and the particulars to be contained therein; (c) fee to be paid with the application for such licences; (d) the authorities to which the application shall be made; (e) condition subject to which such licences may be granted, renewed or revoked; (f) appeals against orders of refusal to grant or renew such licences and appeals against orders revoking such licences; ....
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.... freedom to take the vehicle, wherever he wishes, and he is only obliged to keep the holder of the licence informed of his movements from time to time. When a person chooses to hire a car, which is offered on the strength of a permit issued by the Motor Vehicles Department, then the owner of the vehicle, who may or may not be the driver, will offer his service while retaining the control and possession of the vehicle with himself. The customer is merely enabled to make use of the vehicle by travelling in the vehicle. In the case of a passenger, he is expected to pay the metered charges, which is usually collected on the basis of the number of kilometers travelled. These are all matters, which are regulated by the Government. Unlike the said....
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.... we are of the view that they signify two different transactions. What the lawgiver has chosen fit to tax by way of imposition of service tax is only transaction relating to business of renting of cabs. It is also pertinent to bear in mind that, in the case of hiring, the hirer may refuse to provide the service to the prospective customer. We cannot accept the argument of the learned counsel for the appellant that the Court must ignore the provisions of Section 75 of the Motor Vehicles Act. We are of the view that, when the lawgiver introduced this new source of taxation, it must be treated as having been aware of the distinct concept of renting a cab for which there is provision in the Central Legislation, namely, Section 75 of the Motor V....