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TMI Blog2008 (7) TMI 119X X X X Extracts X X X X X X X X Extracts X X X X ..... treated as "Contract Carriage" and since the Appellants have tourist permits in respect of these vehicles, they were operating tours in tourist vehicles and hence they were liable to pay service tax, and is it on this basis that the Joint Commissioner vide order-in-original dated 16-3-2006 confirmed the service tax demand of Rs. 9,13,642 against the Appellant under section 73 of the Act and besides this, imposed penalties on them under sections 75A, 76, 77 & 78 of the Act. The Commissioner (Appeals) vide the impugned order-in-appeal dated 19-6-2006 upheld the Joint Commissioner's order. 2. Heard both the sides. 2.1 Shri Atul Gupta, Company Secretary, the learned Counsel on behalf of the Appellants made the following submissions :- (1) The Appellants were not operating their vehicles as Contract Carriages. They were in fact, booking seats in buses for regular journey from Jabalpur to various cities up to Nagpur. Therefore, the Appellants were not engaged in the business of operating tours in tourist vehicles and their activity does not come within the purview of "tour operators" as defined under section 65(52) of the Finance Act, 1994. (2) Hon'ble Madras High Court in the case o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ust because the Appellants carried marriage parties in their vehicles on three occasions, they cannot be treated as "engaged in the business of operating tours in tourist vehicles". (6) From various records seized by the Department from the Appellants' office such as conductor's diary, ticket books, cash books and balance sheets for the period from 1-4-2001 to 31-3-2004 and also the statement of Shri Prabhat Kumar Jain, Proprietor of the Appellant firm recorded on 25-2-2005, it is clear that the Appellants had been issuing tickets from Jabalpur to various places up to Nagpur and Raipur. One of the Appellants' vehicles - MP 20E 9902 is engaged with State Road Transport Authority and is running between Jabalpur to Dindori as Stage Carriage. From these facts, it is clear that the Appellants have been operating stage carriages only. (7) Even if it is held that the Appellants' activity is covered by the definition of "Tour Operator' under section 65(52) of the Act, no penalty is imposable and duty demand has to be requantified in view of Notification No. 15/2007-ST dated 4-4-2007 issued by the Government under section 83 of the Finance Act, 1994 read with section 11C the Centra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... : "65(94) 'tour' means a journey from one place to another irrespective of the distance between such places 65(95) 'tourist vehicle' has the meaning assigned to it in clause (43) of section 2 of the Motor Vehicles Act, 1988 (59 of 1988). 65(96) 'tour operator' means any person engaged in the business of operating tours in a tourist vehicle covered by a permit granted under the Motor Vehicles Act, 1988 (59 of 1988) or the rules made thereunder." 4.1 The term 'tourist vehicle' as defined under section 2(43) of Central Motor Vehicles Act, 1988 is 'tourist vehicle' means a Contract Carriage constructed or adopted and equipped and maintained in accordance with such specifications, as may be prescribed in this, behalf." Rule 128 of the Central Motor Vehicles Rules, 1989 give the detailed specifications for a tourist vehicle. 4.1.1 A Contract Carriage has been defined in section 2(7) of the Motor Vehicles Act, as under— "Contract Carriage means a motor vehicle which carries a passenger or passengers for hire or reward and is engaged under a contract, whether express or implied for the use of such vehicle as a whole for the carnage of passengers mentioned therein and entered into ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... finition of 'tour operators' under section 65(52) of the Act. 6. In view of the above discussions, notwithstanding the Appellant's claim that they are running their vehicles as stage carriages, since the Regional Transport Authority has issued tourist permits in respect of their vehicles, under the Central Motor Vehicle Rules, 1989, the same have to be treated as Tourist Vehicles and the Appellants have to be treated as Tour Operators under section 65(52) of the Act. 7. It has, however, been brought to our notice during the hearing that the Central Government has issued a notification No. 15/07-ST, dated 4-4-2007 under section 83 of the Finance Act, 1994 read with section 11C of the Central Excise Act by which the Govt. acknowledging the fact that during the period from 1-4-2000 to 4-2-2004, there was a generally prevalent practice regarding levy of Service Tax (including non-levy thereof) under section 66 of the Finance Act, 1994, on services provided in relation to transport of passengers from one place to another (other than service provided in relation to package tour), operating under Contract Carriage permits issued by appropriate transport authority and that such services ..... X X X X Extracts X X X X X X X X Extracts X X X X
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