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2016 (6) TMI 774 - CESTAT HYDERABAD

2016 (6) TMI 774 - CESTAT HYDERABAD - 2016 (43) S.T.R. 405 (Tri. - Hyd.) - Tour Operator Service - The appellant s contention is that he is not a tour operator. He is not involved in the business of planning, scheduling, organising or arranging tours by any mode of transport. - Scope of Section 65(115) of the Finance Act, 1994, during the period 2005-06 to 2009-2010 - Held that:- prior to amendment made in 2008, the appellant would not fall into the category of tour operator as the vehicles are .....

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on post-2008. - Held that:- The definition implies something more than ordinary travel or transport undertaken. In a situation where admittedly the appellant is transporting different persons with prefixed fair to different destinations in the same vehicle without a common contract, the activity will be more akin to transport of passengers rather than operating tour. More so, when we consider the definition of contract carriage, it is clear that the vehicle engaged should travel without stopping .....

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using such vehicle. - There is absolutely no evidence to show that appellant made arrangements of accommodation to any destination. After perusing the facts and evidence presented before us and applying the law, we are of the considered view that the demand is unsustainable. - Demand set aside - Decided in favor of assessee. - Appeal No. E/25822/2013 - Final Order No. A/30045/2016 - Dated:- 6-1-2016 - Ms. Sulekha Beevi, C.S. Member ( Judicial ) And Mr. B. Ravichandran, Member ( Technical ) S .....

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l Order No.20065/2014 dated 101-01-2014 and the appeal was dismissed. The appellant carried the issue in appeal before the Hon ble High Court of Andhra Pradesh and vide order dated 10-04-2014 in C.E.A. No.52/2014., the Hon ble High Court set aside the judgment passed by the Tribunal and remanded the matter directing the Tribunal to decide the matter afresh with reasons and finding framing the issues and stipulated a period of three months from date of communication of the order. It is understood .....

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ummons to the appellants for production of documents. Accordingly they submitted, permits, registration certificate of the vehicle, details of balance sheet for the period 2005-2006 to 2009-2010. After verification and scrutiny of documents, the department entertained the view that appellants have rendered the service of Tour operator service as defined under Section 65(115) of the Finance Act, 1994, during the period 2005-06 to 2009-2010. A show cause notice dated 22-10-2010 was issued invoking .....

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service ; the buses of the appellant were having a contract carriage permit. They are not tourist vehicles as defined under Section 2(43) of the Motor Vehicle Act, 1988. A contract carriage which is constructed or adapted or equipped or maintained in accordance with specifications prescribed under rule 128 of the central Motor Vehicle rules can alone be called as a tourist vehicle. As per the definition of tour operator firstly, the vehicle used must be a tourist vehicle, secondly, the vehicle m .....

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and Section 88(9) of the Motor Vehicle Act, 1988. The vehicles covered under such permits are not constructed according to specifications prescribed in Rule 128 of Central Motor Vehicle Rules, 1989. The appellant has made requisite payment to the authorities for the class of vehicle registered. But in actual use, the vehicle is operating as a stage carriage. The vehicles are operated to various places like from Shirdi, Hyderabad, Bangalore, Visakhapatnam etc. both intra-state and inter-state tr .....

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them back. The appellant is not undertaking any conducted tour operations. The vehicles are used as stage carriages by collecting individual charges from passengers going to different places for different purpose. To substantiate his arguments, the learned counsel relied on various vehicle check reports in which it is noted that individual passengers are picked up from different places for individual purpose of journey and tax has been collected per seat as in the case of a stage carriage; that .....

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contract carriage would fall into the category of tour operator if the contract carriage has a permit other than a stage carriage permit. She laid much thrust on the observations made by Hon ble High Court of Madras in the case of Secretary Federation of Bus Operators Association of Tamil Nadu Vs Union of India reported in 2006(2) STR 411(Mad) and also in Sri Pandyan Travels Vs CCE, Chennai reported in 2006(3) STR 151(Mad). Since the tour is defined as a journey from one place to another irresp .....

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the period 2005-06 to 2009-10; b) to decide the issue at (a) above, the consideration is whether or not the appellant is within the scope of term tour operator as per Section 65(115) of Finance Act, 1994 for the period prior to and also post amendment by Finance Act, 2008; c) whether or not the appellant is engaged in the business of operating tour in a tourist vehicle (upto 2008), tourist vehicle/contract carriage (post 2008); d) whether or not the activity sought to be taxed at the hand of th .....

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tion 65(115) Tour Operator means any person engaged in the business of planning, scheduling, organising or arranging tours (which may include arrangements for accommodation, sightseeing or other similar services) by any mode of transport, and includes any person engaged in the business of operating tours in a tourist vehicle covered by a permit granted under the rules made under the Motor Vehicles Act, 1988 (59 of 1988) or the rules made thereunder; The above definition was amended vide Finance .....

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59 of 1988) or the rules made thereunder; 9. The appellant s contention is that he is not a tour operator. He is not involved in the business of planning, scheduling, organising or arranging tours by any mode of transport. The learned counsel for the appellant strongly contested the finding of the original authority that they are tour operators . On this issue, the learned AR argued that prior to 2008 the appellants are covered under the inclusive portion of the definition which states that any .....

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s in a tourist vehicle/contract carriage vehicle. We find that this contention requires close scrutiny. 10. First, we take up the reliance place by the learned AR on the decision of Hon ble Madras High Court in the case of Secretary, Federation of Bus-operators Association of Tamil Nadu Vs. UOI [2006(2) STR 411 (Mad.)]. It is seen that the Hon ble High Court held that the first and foremost condition for a person to be held as a tour operator within the meaning of Section 65(52) of the Finance A .....

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Pradesh Motor Vehicles Rules, 1989. There is no mention about permission to operate as a tourist vehicle. As per Section 2(43), a vehicle can be a tourist vehicle only when it conforms to the specifications prescribed under Rule 128 of Central Motor Vehicles Rules. Here the department has no case that the buses of the appellant conform to such specifications. The original authority in his order stated that when a contract carriage is given all India permit to conduct tour it will imply that the .....

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ted above. Otherwise a specific certification by the competent authority categorising the vehicle in terms of above provisions as tourist vehicle is required. The original authority s conclusion based on implication is not tenable. The decision of Hon ble Madras High Court as above is relevant here. Now it is clear that prior to amendment made in 2008, the appellant would not fall into the category of tour operator as the vehicles are not tourist vehicles. Again the definition of tour operator h .....

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post-2008. After 2008, the definition was extended to cover tour operation in any vehicle other than stage carriers. Even here the appellants have produced evidence to the effect that though they were permitted as contract carriers they were operating more as stage carriers for passengers. For this they relied on various check reports made by Regional Transport Authority while checking their vehicles in different routes. They have been taxed in the category of stage carriers in view of such tes .....

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passengers. In other words, each passenger embarks and disembarks the vehicle as per their intent and on payment of fare due. 12. The Tribunal in the case of CCE, Bhopal Vs. Suresh Kumar Advani [2014(35) STR 138 (Tri. Del.)] examined the scope of tourist vehicle. The Tribunal held that the tourist vehicles are to be vehicles which are covered in terms of Section 2(43) of Motor Vehicles Act read with Rule 128 of the Central Motor Vehicle Rules and the tour operator should be accordingly consider .....

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distance between such places. From this, it is apparent that the person travelling in the bus is undertaking a tour. This by itself does not imply the appellant becomes a tour operator for different passengers boarding the bus for same or different destination paying different fare. The activity is more akin to transporting passengers from one place to another rather than operating a tour. The proposition which is for consideration is that any person operating a tour using a vehicle other than .....

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ng, organising or arranging tours (which may include arrangements for accommodation, sightseeing or other similar services) by any mode of transport, 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 thereunder; (emphasis supplied) The definition implies something more than ordinary .....

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