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TMI Blog2023 (10) TMI 678X X X X Extracts X X X X X X X X Extracts X X X X ..... Airline concerned. The airline tickets can be booked through Computer Reservation System (CRS). There are service providers for CRS such as Amadeus, Galileo, Wordspan etc. The CRS provider enters an agreement with the Airline to provide the facility of reservation through a computer system. The Airline pays the CRS provider for the said service. The CRS provider on its part enters into agreement with the travel agent in terms of which they provide the travel agent free of cost the equipment and software and pays an incentive to the travel agent on condition that the travel agent shall use the CRS of the said CRS provider. Such incentive is in the nature of loyalty reward. The travel agent finds it convenient to use the CRS as it is u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the incentive/commission received by the appellant from M/s.Galileo India Pvt. Ltd. qualify as business auxiliary service under section 65(19) of the Finance Act, 1994 and they are liable to pay service tax. Accordingly, the demand of service tax was confirmed along with interest and penalties were also imposed. Against the said orders, the appellant is before us. 3.1 The Ld. Counsel appearing on behalf of the Appellant submits that the issue is no more res integra in the light of the Larger Bench decision in the case of Kafila Hospitality & Travels Pvt. Ltd. vs. Commr. of S.T., Delhi [2021 (47) G.S.T.L. 140 (Tri.-LB)], which was followed by this Tribunal in the case of Asveen Air Travels (P) Ltd. vs. Commissioner of GST & Central Exc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lines provide air transport services to passengers and discharge their service tax liability in terms of Section 65(3b) read with Section 65(105)(zzzo) of the Finance Act, 1994 [Finance Act]. The travel agents accredited by IATA are authorized to sell the air travel services provided by airlines to customers/sub-agents in the form of airline tickets. CRS Companies provide an online portal for booking of tickets offered by various airlines. They enter into agreements with airlines for rendering 'Online Information Data Access and Retrieval' [OIDAR] services, wherein they collate data such as ticket availability, price, duration of journey, etc., for access by subscribers. CRS Companies also enter into subscriber agreements with IATA agents w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d instead, in order to increase the flow of business, the CRS Companies started to part with a portion of their consideration (charges/commission) and paid the same to the IATA agents when the agents achieve a minimum quantum of bookings through the concerned CRS portal. This incentive is normally termed as 'CRS commission'. The three CRS Companies involved are Amadeus India Private Limited [Amadeus], Interglobe Technology Quotient Pvt. Ltd. [Galileo] and Abacus India [Abacus]. xx xx xx 41. On a consideration of the entire matter it transpires that the following two main issues arise for determination:- (Q) Whether service tax can be levied under the category of 'business auxiliary service' on target based incentives paid to the tr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 67 of the Finance Act. xx xx xx 84. The inevitable conclusion, therefore, that follows from the above discussion is as follows :- (i) the air travel agent is promoting its own business and is not promoting the business of the airlines; (ii) the air travel agent is not promoting the business of the CRS Companies; (iii) in any view of the matter, the classification of the service would fall under "air travel agent" service and not "BAS" in terms of the provisions of Section 65A of the Finance Act; and (iv) the incentives paid for achieving the targets are not leviable to service tax. 6. Following the said decision, we are of the considered opinion that the demand cannot sustain and requires to be set aside, which we her ..... X X X X Extracts X X X X X X X X Extracts X X X X
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