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M/s S.V.R. Tours and Travels Versus C.C.E & ST, Hyderabad

2016 (6) TMI 774 - CESTAT HYDERABAD

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 not tourist vehicles. Again the definition of tour operator has two segment .....

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nary 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 to pick up or set down, anywhere in the journey, passengers not included i .....

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llant 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 ) Shri K.N. Jwala Sr. Advocate and Shri B. Seetharamaih, Advocate for Appellan .....

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ppellant 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 that as the appeal was initially disposed by circuit bench and as the benc .....

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itted, 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 the extended period of limitation proposing the demand of service tax of & .....

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. 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 must be covered by a permit granted under the Motor Vehicle Act or Rules mad .....

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er 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 transport. He submitted that for travel in the buses the ticket charges are c .....

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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 the appellant is not engaged in the business of operating tours by tourist .....

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tract 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 irrespective of the distance between such places; there is no requirement for pla .....

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nsideration 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 the appellant will be covered under the term tour in terms of Section 65(113) .....

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ning, 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 Act, 2008 as below:- Section 65(115) Tour Operator means any person engaged .....

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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 person engaged in the business of operating tours in a tourist vehicle will .....

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ion 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 Act is that he must be engaged in the business of operating tours in a touri .....

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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 buses conformed to the specification of the tourist vehicles. We find that .....

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tegorising 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 has two segments. One in the first portion dealing with person engaged in th .....

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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 test/check reports. The learned AR contested this on the ground that these che .....

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cle 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 considered. Similar issue was decided by the Tribunal in the case of Choudhary Yatr .....

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avelling 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 stage carrier will make that person who is transporting the passenger as a .....

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modation, 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 travel or transport undertaken. In a situation where admittedly the appell .....

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