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2023 (9) TMI 1254 - AT - Service TaxNon-payment of Service Tax - Rent-a-Cab Service - the fact that the turnover of each of the appellants was well within the exemption limit provided under Notification No. 06/2005 dated 01.03.2005 not taken into account by authorities - service qualify as rent a cab service or not - penalties - HELD THAT:- The gross value of the taxable service rendered by each of the appellants is less than the threshold limit of Rs.10 Lakhs as prescribed under Notification No. 06/2005-ST dated 01.03.2005 after giving allowance to the exemption for 60% of the gross receipt in terms of Notification No. 01/2006-ST dated 01.03.2006. We find that the Departmental authorities have considered this principle and accepted the contention of the appellants in the case of VISHWANATH MISHRA VERSUS COMMR. OF C. EX., LUCKNOW [2018 (4) TMI 1677 - CESTAT ALLAHABAD] and SECY. FEDERATION OF BUS-OPERATORS ASSN. OF TN VERSUS UNION OF INDIA [2001 (4) TMI 7 - MADRAS HIGH COURT]. The Principal Bench of CESTAT, in the case of M/S. ASHOK KUMAR MISHRA VERSUS CCE, ALLAHABAD [2014 (1) TMI 609 - CESTAT NEW DELHI] held that for the purpose of calculating the threshold limit, 60% of the consideration exempt, vide Notification No.01/2006, should not be taken into account. If 60% of the consideration received by the appellants is excluded, they fall under the exempted category and as such, are not liable to pay any tax. Therefore, we find that the appeals succeed on this count. Ongoing through the agreements relied upon by the appellants, it is found that the appellants have simply provided their buses to M/s PRTC on hire and have received remuneration on per-kilometre basis; there is no arrangement of renting. Classification of service as rent-a-cab service or not - HELD THAT:- Hon’ble High Court of Uttrakhand in the case of COMMISSIONER, CUSTOMS AND CENTRAL EXCISE, MEERUT-I VERSUS M/S. RS. TRAVELS [2014 (10) TMI 817 - UTTARAKHAND HIGH COURT] held that when there is a contract of hire and there is no renting of a cab, there is no question of the assessee being assessed in respect of services rendered in connection with rent-a-cab as there is no renting at all. Therefore, we are of the considered opinion that the appeals succeed on the issue of classification of services also. Penalties - HELD THAT:- The appeals succeed on both counts, the question of penalties does not arise. The impugned orders are not sustainable and are liable to be set aside - Appeal allowed.
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