TaxTMI 
TaxTMI 
2016 (6) TMI 1268
X X X X Extracts X X X X
X X X X Extracts X X X X
.... and buses are operated on the strength of stage carriage permits. 1.3 It appeared to department that various chartered/contract/tour services provided by APSRTC to the public fall under the " tour operator" services as defined under the clause (115) of Sec.65 of the Finance Act, 1994 and that APSRTC were providing various tour operator services and evading payment of Service Tax. 2. Show cause notices dated 07-02-2006, 02-04-2007, 15-10-2008, were issued to appellant/assessee proposing recovery of service tax on the amounts received by them on aforesaid activities respectively for different periods, which were confirmed by respective adjudicating authorities. Hence appeals Nos.284/2007, 366/2008, and 379/2009 by assessee. Department has also come in appeal by filing appeal No.312/2007 against dropping of demand by adjudicating authority for the period 4/2000 to 9/2004. The summary of the details of the Show cause notice, demand of service tax and period involved in the appeals are given in the following table. S. No. Appeal No. SCN Period OIO Demand Confirmed penalties 1. ST/284/2007 8/2006 dt. 7.2.2006 10.09.04 to 3/2005 (demand from 4/2000 ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ove submissions, appellants rely on the following decisions of the Hon'ble Tribunal. 1) CCE & C, Vadodara-II, Vs Gandhi travels 2007(79) RLT 774(CESTAT-Ahmd). 2) Praseetha Suresh vs CCE Thiruvananthapuram, 2006(3) STR 777(Tri.Bang) 3.3 The learned Commissioner has erred in demanding service tax w.e.f 10-09-2004 under a wrong impression that with effect from 10-09-2004 the requirement of the use of tourist vehicles by tour operators has been dispensed with and that the judgment of the Hon'ble Madras High court in the case of Secretary, Federation of Bus Operators Association or Tamil Nadu Vs Union of India, wherein it was categorically held that in order ot levy service tax on stage carriage operators /contract carriage operators, the vehicles used must be tourist vehicles as contemplated under section 2(43) of the M.V. Act read with Rule 128 of M V Rules, would not come in the way to levy service tax on tour operators who are not using tourist vehicles for the purpose of tour. However, as already stated above, the circular dated 17-09-2004 is very clear to the effect that the amendment made in the definition of "tour operator" in the budget 2004, was with....
X X X X Extracts X X X X
X X X X Extracts X X X X
....nce the entire demands proposed in the Show cause notice are legal and proper. He further stated that the definition of Tour operator refers to any person "engaged" in the business of planning, scheduling, organizing or arranging Tours by any mode of transport which is precisely the activity undertaken by the appellant. In regard to the appeal filed by department the learned AR submitted that Commissioner has erred in dropping the demand prior to 10-09-2004 without verifying whether the vehicles indeed do not conform to Rule 128 of the motor Vehicle Rules. He finally urged that the transportations having been done under a contract whether explicit or implicit, the activity would attract service tax being contract carriages and thus falling within the definition of Tour operator. 6. We have heard both sides at length and also perused the records carefully. Before we proceed to analyse the issue under consideration, the relevant provisions of the Finance Act, 1994 are extracted as under for better appreciation of the issue. Term defined Reference to the Finance Act, 1994 Definition Tour Section 65(50) "tour" means a journey from one place to another irrespective ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ein and entered into by a person with a holder of a permit in relation to such vehicle or any person authorized by him in this behalf, on a fixed or an agreed rate or sum: a) On a time basis, whether or not with reference to any route or distance or b) from one point to another an d in either case, without stopping to pick up or set down passengers not included in the contract anywhere during the journey. 7. From the above definitions it emerges that for the entire period of the dispute, viz; 01-04-2000 to 2007-08, irrespective of the amendments to the definition of "tour operator" in the finance Act,1994 the activities of the appellant would not attract service tax under the said service category. To be covered under the definition of "Tour operator" the person should be engaged in operating tours in a tourist vehicle covered by a permit. Tourist vehicle has a meaning assigned to it in Section 2 (43) of the Motor Vehicles Act, 1988 which states that a contact carriage constructed or adapted or equipped or maintained in accordance with prescribed specifications. The specifications are provided in Rule 128 of the Motor Vehicle Rules. The departments do not have ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....d as a tourist vehicle. The question is not as to whether a permit under Section 88(8) would ipso facto become a permit covering a contract carriage. It has to be borne in mind that a tourist vehicle as defined under Section 2(43) of the Motor Vehicles Act which definition has been picked up as it is by the Finance Act, means a contract carriage constructed or adapted and equipped or maintained in accordance with such specifications as may be prescribed more particularly the specifications prescribed under Rule 128 of the Motor Vehicles Rules. Therefore, this ruling will not help the petitioners to suggest that a vehicle covered under Section 72(2)(xvii) merely for that reason or merely because it is having permit under Section 88(8) of the Motor Vehicles Act for its occasional use can never become a tourist vehicle. A plain reading of the provisions of the Motor Vehicles Act says that any such vehicle which answers the description of the tourist vehicle under Rule 128 and which would run under a contract would become a tourist vehicle and once it becomes a tourist vehicle so long as it is being used under any permit under the Motor Vehicles Act, by a person who is engaged in the b....
X X X X Extracts X X X X
X X X X Extracts X X X X
....o consideration the relevant definition of tour, tourist vehicle, tour operator, and vide relying upon the decision of Hon'ble Madras High Court's decision in the case of Secy. Federn. of Bus-Operators Assn. of T.N. v. UOI & Others reported in 2006 (2) S.T.R. 411 (Mad.) = 2001 (134) E.L.T. 618 (Mad.) held that the service provided by the respondent did not fall within the definition of tour operator and accordingly set aside the lower adjudicating authority order. Aggrieved, Revenue filed this appeal. 3.?The contention of the appellant is that the Commissioner (Appeals) has relied upon certificate issued by Regional Transport Authority, Rajkot for bringing the vehicles used by the respondent out of the purview of definition of tourist vehicle as defined in the Section 2(43) of the Motor Vehicle Act, 1988 at the conclusion arrived at by the appellate authority was prima facie wrong and he has overlooked that the lower adjudicating authority has personally examined the vehicles and arrived at conclusion that the vehicle predominantly covered the specification made in Rule 128 of Motor Vehicle Rules, 1988. They also placed reliance on the decision referred supra wherein the H....
X X X X Extracts X X X X
X X X X Extracts X X X X
....Court of Madras in the case of Secy. Federn. of Bus-Operators Assn. of T.N. v. UOI & Others reported in 2001 (134) E.L.T. 618 (Mad.). The appellant could not produce any evidence to demolish the conclusion arrived at by the learned Commissioner (Appeals). The Revenues appeal is devoid of merits. Therefore the Commissioner (Appeals)' order is upheld and Revenue's appeal is dismissed. 10. Though an appeal was preferred by department against this Tribunal order, however the same was dismissed by the Hon'ble Apex Court in 2012 (27) STR J79 (S.C.). Similar view has been taken in Jai Somnath Transport V CST, Mumbai 12016 (41) STR 660 (Tri- Mum) 4.7?Revenue, it appears, is confusing the words "Tourist permit" and "Tourist vehicle" and reading the word "permit" to mean the same as Tourist permit. Here too the judgment in Secy. Federn. of Bus Operators Association of T.N. (supra) clarifies the matter beyond doubt. It was held therein that "29. It, therefore, cannot be said that the permit contemplated under Section 65(52) of the Finance Act is a tourist permit alone contemplated under the Motor Vehicles Act or the rules framed thereunder. The argument is obviously based on the ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... definition, any person who is engaged in the business of planning, scheduling, organizing or arranging tours is a Tourist Operator. We have already noted that the second part of the definition, which requires the vehicle to be a tourist vehicle, does not cover the services rendered by the parties in the category of "Tour Operator". We find in some cases such as S.K. Travels and Buthello Travels, and the SCN only referred to the second part of the definition even for the period post-10-9-2004. The findings by the Commissioner in the Orders in respect of these parties and in the case of Jai Somnath do not explain at all how and whether the activity is covered by the first part of the definition. In such cases the appeals fail as held in Para 4 above. 5.1?In other cases we may examine whether the appellants are engaged in the business of planning, scheduling, organizing or arranging tours. We have seen the Agreements between appellants and their clients. We find that the appellants have only planned for providing vehicles of a specific capacity with a particular schedule. We also note that at the time of expansion of the definition of Tour Operator on 10-9-2004, C.B.E. & C. ....