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2016 (10) TMI 557 - HC - Indian LawsPayment of motor vehicle tax, penalty and interest - the petitioner is plying a Deluxe service vehicle - Held that:- Stage Carriage services are either Ordinary or Express and Deluxe. The seating arrangement of a tourist vehicle provided under Rule 128 of the Central Rules applies to the Deluxe buses, i.e., Deluxe services by virtue of Rule 158 (2) of the Rules of 1994 and the rate of tax per seat in respect of such Deluxe services are provided in the first Schedule of the Taxation Act. Therefore, in order to make any permit holder liable to pay tax per seat applicable to a Deluxe bus, the vehicle has to provide for seating arrangement and other features in accordance with Rule 128 of the Central Rules and Rule 158 (2) & (3) of the Rules of 1994. However, on perusal of the Traffic Inspector's verification report, it would clearly appear like noon day that the petitioner's vehicle has seating capacity of 2 x 3 and not two and two or one and two or one and one on either side, as provided under Rule 128(10)(ii) of the Central Rules. When the petitioner's permit is not issued for Deluxe service nor the vehicle is designed to have seating arrangement of a deluxe vehicle, the petitioner is not liable to pay tax for Deluxe services, therefore, the impugned demand deserves to be set aside. Whether a service can be classified as Deluxe service only on the ground that the seats in the vehicle have push back or reclining facility. It appears, there is no such provision that only on such facility being available in a vehicle it can be classified as a Deluxe service. What Rule 128 (iii) of the Central Rules provides for is only one of the requirements of seating arrangement for a tourist vehicle and that is not the only requirement for classifying a vehicle as tourist vehicle. Even otherwise, the impugned demand notice has been issued without making any assessment in accordance with the procedure prescribed under Rule 8-A of the Taxation Act. - Decided in favour of assessee
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