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2024 (2) TMI 567 - AT - Service TaxRent-a- Cab Operators service - Abatement of 60% of the assessable value vide Notification No.09/2004 dated 09.07.2004, 01/2006- S.T. dated 01.03.2006 and Notification No.6/2005-S.T. dated 01.03.2005 - HELD THAT:- As per the agreement reached between the Appellant and UPSRTC, it would be evident that Appellant attached his bus with UPSRTC on the basis of profit sharing. There is no fixed rent or hire charges. Instead, the profit is variable. Therefore, attaching a bus with the UPSRTC on profit sharing basis would not come under the taxable service under the ‘rent-a-cab operator service’ of the Act, as the ingredients of the definition are absent. From the perusal of the Explanation "B" to Notification No. 06/2005-S.T. dated 01.03.2005, it would be evident (i) that the aggregate value for the purpose of this notification would be gross value of taxable services bereft of the value of goods used in providing the service; (ii) that the aggregate value shall be determined after deducting the gross amount exempt from whole of service tax under Notification No. 12/2003-ST dated 20.06.2003 or Notification No. 01/2006-S.T. 01.03.2006 (as amended). On deduction of the amount as envisaged under Notification No. 01/2006 ST dated 01.03.2006, aggregate taxable value each year would be much below the exemption limit as envisaged in the Notification No. 06/2005 ST dated (01.03.2005). That Notification No. 06/2005-ST dated 01.03.2005 (as amended) seeks to exempt taxable service of aggregate value upto to Rs. Ten lakhs in any financial year in the case of rent-a- cab service, the value under Section 67 of the Finance Act, 1994 would be 40% of the gross amount as per notification No. 01/2006-ST dated 01.03.2006. The rest 60% of value is attributable to value of goods which is exempt under Notification No. 01/2006-ST dated 01.03.2006. According to explanation No. (B) of clause-3 of notification number 06/2005-ST dated 01.03.2005, the gross amount which is exempt from payment of service tax would not constitute in the aggregate value of taxable service - in this case, the taxable value in every financial year is far less than the exempted limit. As such, no service tax is payable by the Appellant. The impugned order to the extent of confirmation of the demand and imposition of penalty are set aside - Appeal allowed.
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