TaxTMI 
TaxTMI 
2024 (9) TMI 1252
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....nd was confirmed vide Order-In-Original dated 20.02.2013 and demand made in another show cause notice issued on 27.11.2012 was also confirmed on 24 January, 2014. The said demands were upheld by the Commissioner (Appeals) and consequently, these appeals have been filed. 2.2 Learned Counsel pointed out that in case of Pre-Planned Package Tours, the activity of planning, scheduling, organizer or arranging (Planning, Scheduling, Organizing And Arranging ) takes place prior to booking of tour by the customers. The appellants prepare brochure giving details of the location of visit, dates of departure of tours etc. He argued that the brochures are prepared after completion of the event of planning, scheduling and part of organizing of likely Hotels etc. He argued that at the time of planning, scheduling, etc, in such cases, there is no customers available and therefore in absence of a client there could not be any possibility of provision of any taxable service. 2.3 Since at the time of planning, scheduling etc., of pre-planned package tours there are no identified service recipients, it was a service to self and therefore not a taxable service. He pointed out that in ....
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....t the services falling under Rule 3(1) (ii) of the Export of Services Rules, 2005 shall treated as export of services if place of performance is partly outside India. He argued that in terms of proviso to Rule 3(ii) of the Export of Services Rules, 2005, entire service of tour operator will be considered as rendered outside India. He relied on the following decision for this purposes. • B.A. RESEARCH INDIA LTD 2010 (18) S.T.R. 439 (Tri. Ahmd.) • SGS INDIA PVT. LTD 2014 (34) S.T.R. 554 (Bom.) • MAERSK INDIA PVT. LTD 2015 (38) S.T.R. 1121 (Bom.) 2.7 He further relied on the decision of Tribunal in the case of Creative Travels Pvt. Ltd.-2022 (10) TMI 9-CESTAT New Delhi wherein para 14 following has been observed. "14. The change in the statutory provision has added elements to the activity that makes for being tour operator both the unamended and amended version, entirety of performance in India is the criterion for subjecting the consideration to tax. That is the only conclusion that can be arrived at from perusal of Export of Service Rules, 2005 which categorizes the scheme of export in terms of the enumeration of ....
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....c snow point. Night halt at Srinagar. Day 3 Srinagar: after breakfast enjoy Shikara Ride at Dal Lake for 2 hrs (at our cost). After lunch, sightseeing of Shankaracharya Temple, Nishat Baug 7 Shalimar Baug. Night halt at Srinagar. Day 4 Srinagar Gulmarg - Srinagar: After breakfast proceed to Gulmarg (3hrs. journey) to enjoy Gandola Cable Car Tide (at Your own cost) also enjoy photography, horse riding & Shopping at this beautiful snow point. In the evening return back to Srinagar (3hrs. journey). Night halt at Srinagar. Day 5 Srinagar- Pahalgam: After breakfast proceed for Pahalgaum (4 hrs. journey), After lunch enjoy shopping & natural beauty of this exotic place Night halt at Pahalgaum. Day 6 Pahalgam: After breakfast enjoy the natural beauty at Chandanwadi (at our cost), enjoy hours riding at this at beautiful place (at your own cost). Night halt at Pahalgaum. Day 7 Pahalgam Srinagar: After breakfast transfer to Srinagar Airport to board your flight for Mumbai with Memorable experience of the tour conducted by Heena Tours & Travels. 5. The legal provision related to the case are as follows: 5.1 The Section 64 of the Finance Act, ....
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....n a commercial training or coaching centre, imparting skill or knowledge or lessons or any subject or field." 5.4 The word 'tour 'was defined in Section 65 (113) as follows: "(113) "tour" means a journey from one place to another irrespective of the distance between such places." 5.5 It is apparent that the definition of tours operator has two parts:- Tours Operator" means (i) "Any person engaged in the business of planning, scheduling, organizing or arranging tours (which may include arrangements for accommodation, sightseeing or other similar services) by any mode of transport, (ii) and includes any person engaged in the business of operating tours in a tourist vehicle or a contract carriage by whatever name called, covered by a permit, other than a stage carriage permit, granted under the Motor Vehicles Act, 1988 (59 of 1988) or the rules made there under". Both these are individually taxable services as held in the case of M/s. Cox & Kings India Ltd CESTAT Mumbai Interim Order No. 104/2023 dated 19.10.2023 as extracted in para 7.3 below. In the first category the taxable activitie....
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....ads as follows: "On a representation as to whether service tax is applicable in cases where service providers located outside the state of Jammu and Kashmir have rendered services in the state of Jammu and Kashmir, it is clarified that in terms of Finance Act, 1994, service tax is not applicable to services provided in the State of Jammu & Kashmir, irrespective of the service provider being from the State or otherwise. The content of this Trade Notice may be brought to the notice of all concerned." The above circular applies only to cases where the services are provided in the state of Jammu and Kashmir. 7.1 In the instant case, it is clear that the services are provided outside state the of Jammu and Kashmir. In the Order-In-Original, the following has been recorded as the manners of providing services. "The assessee is engaged in the business of conducting and operating the package tour in the state of J&K. The various steps which are required to be carried out for conducting the tour are as follows:- a) Determining the probable dates and venues of the tour. b) Finalizing the itinerary of the tour. c) B....
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....red by a permit granted under the Motor Vehicles Act or Rules made there under would not be excluded from the definition of a „tour operator‟ contained in the first part. It needs to be noted that a permit granted under the Motor Vehicles Act or the Rules made there under does not operate beyond the jurisdiction of the country. The first part of the definition of a "tour operator‟ is by any mode of transport and, therefore, there is no restriction about the territorial jurisdiction of the country. It only deals with the planning, scheduling, organizing or arranging tours (which may include arrangements for accommodation, sightseeing or other similar services) by any mode of transport. 36. It is, therefore, not possible to hold that what is contained in the inclusive clause of the definition is necessarily not contained in the first part of the definition as was held by the division bench in the earlier decision in Cox & King." Thus, the service consists only of Planning, Scheduling, Organizing And Arranging tours. 7.4 The situation can be explained more elaborately with following examples:- i) If a person uses services of a tailor and uses ....
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....ansaction would be where the service provided by a person in India is received by a person located abroad. Second mode of service export can be when service is supplied by a service provider located in of service export would be where service is supplied from India through commercial or physical presence in territory of any other country, like a software company providing the services of software development to its client in USA by sending its employees to USA In 2nd and 3rd types of service transaction, the criteria of crossing the international border would be impossible to apply". "77. The point of difference as mentioned in Para 60 of the referral order has been answered by third Member as under :- "In view of the above discussion, the points of difference, mentioned in para 60 are answered as under :- (i) The term "export" has not been defined either in Article 280(1)(b) or in any of the article of the Constitution of India. Though the Apex Court's judgments in the case of the State of Kerala v. The Cochin Coal Company Ltd. [(1961) 2 STC 1 SC] and Burmah Shell Oil Storage & Distribution Co. of India v. Commercial Tax Officer & Others reported in (196....
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....ness auxiliary service", being provided to Western Union. It is Western Union who is the recipient and consumer of this service provided by their agents and sub-agents, not the persons receiving money in India. (v) The consumer of the service provided by the agents and sub-agents of WU in India is the Western Union, located abroad who use their services for their money transfer business not the persons receiving money in India. Since the service provided is Business Auxiliary Service classifiable under Section 65(105)(zzb) read with Section 65(19) of the Finance Act, 2005, and has been provided in relation to business of Western Union located abroad, and the payment for the service has been received in India in convertible foreign currency, the same has to be treated as export of service. It is the person who requested for the service and is liable to make payment for the same who has to be treated as recipient of the service, not the person or persons affected by the performance of the service. Thus, when the person on whose instructions the services in question had been provided by the agents/sub-agents in India and who is liable to make payment for these services, is lo....
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....ted outside India. Further, the argument was that this is a contract based tax. The contract is of services. There is no contract in this case with the manufacturer of goods in India. Further, there is no contract and no privity between the respondent and the exporter of the goods who is stated to be based in India. It is in these circumstances that the exemption notification though required to be strictly construed has rightly been construed in favour of the respondent assessee before us." In this case as well the person entering into contract with service provider was held as service recipient. It is the appellant who enter into contract with hotel owners, guides, vehicle owners etc. Therefore, he is the service recipient in respect of the services provided by them. The 'tourist' clients of the appellant are located within the taxable territory of India and all their transactions happen with taxable territory of India. 8.3 The hotels are the service providers to the appellant. Similarly the tourist guides or vehicle owners who take the tourist around in J & K might be located in Jammu & Kashmir are service providers to appellant and not to tourist who are client....
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....f a tailor in Delhi for a stitching a suite only to be worn in Jammu and Kashmir, can he claim that the service has been used in Jammu and Kashmir. If a person engage services of a coaching centre in Delhi for an exam conducted in Jammu and Kashmir can be claimed that the coaching service has been provided in Jammu and Kashmir. 9. The appellant has argued that in case of pre-planned purchase torurs, before preparation of voucher, listing the itenary of place of visit takes place in India other than J&K. However, at this time of planning/scheduling the such customer is not available. Therefore, it was submitted by appellant that such services which are rendered without reference to any customer shall be considered as self-service. The appellant has also argued that in case of pre-planned package tours, the activity of performing. Scheduling part of organizing takes place prior to booking of tour by customers. 9.1 We find that the claim made by the appellant that activities are made Planning, Scheduling, Organizing and Arranging happens prior to the Customer approaching very doubtful. It is seen that the activity of Planning, Scheduling, Organizing and Arranging involves ....