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TMI Blog2024 (7) TMI 1115X X X X Extracts X X X X X X X X Extracts X X X X ..... hat Appellant had registered itself for providing various services including Travel Agent, Advertising Agency Services, Rent-a-Cab Operator Services, Business Auxiliary Services etc. On receipt of credible information by the DGCEI that Appellant was not appropriately discharging its Service Tax liability, search was conducted in the address of Appellant at Link Road, Mallad West, Mumbai on 14.01.2009, relevant records were obtained, further investigations were carried out, officials of Appellant company tendered their statements and it was ultimately noticed that Appellant had discharged its Service Tax liability under one Heading "Travel Agent" and not in respect of other services, for which it had registered itself. It was also brought out during investigation that Appellant was engaged in booking accommodation for Customers through its website 'travelguru.com' in which every detail of availability of hotels in cities, its tariff, amenities, etc. were available enabling customers to choose the hotel on their own and making reservation through online transactions and by virtue of agreement with various hotels, Appellant being allowed to accept the hotel booking, was al ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m accommodation that was collected by the Appellant from the customer was passed on to the hotel after deduction of the commission receivable from hotel by the Appellant against which Service Tax was discharged. 3.2 On classification of service, he further argued that learned Commissioner had arrived at an erroneous conclusion that Appellant had been providing 'Tour Operator Service' to the customers and the classification of service provided by it as 'travel agent' was not correct for which the manner of discharging Service Tax liability was unacceptable as it is based on a wrong premises without proper interpretation of the provision of law vis. a. vis. definition of 'Tour Operator Service' as available under Section 65(115) of the Finance Act, 1994 wherein arrangement of accommodation was not a standalone service as being made part of the business of planning, scheduling, organising or arranging tours in a tourist vehicle or through any mode of transport and therefore, operating tours in tourist vehicle is a condition precedent to providing accommodation, which is not the situation in the present case. In drawing our attention to the sample invoices enclosed i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... commissions would be of no material consequence to the Respondent-Department. 3.5 Learned Counsel for the Appellant also led his argument on two more vital issues - namely, double taxation and invocation of extended period. Drawing our attention to para 21 of the Order-in-Original (page 105 of the appeal memo) he submitted that while acknowledging payment of Service Tax of Rs.3,33,45,046/- by the Appellant for the said period, learned Commissioner had confirmed the entire amount proposed in the demand-cum SCN after holding that no legal provision exist whereby set off of Service Tax could be made in respect of Service Tax receipt and Service Tax confirmed, which is contrary to the very conception of taxation statute which no law of the land would approve of and the very element of double taxation even of a small fraction has made his order unsustainable. 3.5.1 Secondly, on the point of a demand raised for the extended period, he restricts his argument to the fact that there were at least 13 communications made by the DGCEI as well as Respondent-Department between 05.10.2006 and date of issue of show-cause notice i.e. on 18.08.2011 and sev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r so as to invoke jurisdiction of this Tribunal. 4.1 He also pointed out that para 2.2 of the Order-in-Original, that brings on record the detail of investigation carried out by the DGCEI, bears testimony to the fact that Appellant had not filed ST-3 return from April, 2007 to October, 2008 but subsequently filed the same which is manifest in ST-3 return copies available from page 236 to 256 with a noting that filed belatedly and therefore, the contention of Appellant that suppression is not made out is not tenable, for which interference by the Tribunal in the order passed by the Commissioner is uncalled for. 5. We have perused the case record, written note and additional written submissions received from learned Counsel for the Appellant alongwith compilation of case laws. Primarily issue being one of classification of the service, the same is taken up at the first instance for the purpose of discussion and for rendering our finding on it. 6. Para 14 of the show-cause notice (SCN) dated 18.08.2011 reads: "Para 14 The notice is restricted to the Service Tax liability of M/s. DVTG [M/s. DV Travels Guru Pv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e 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 or the rules made thereunder." (Underlined to emphasise) Thereafter, definitions of "tour operator service" had undergone a slight change and w.e.f. 16.05.2008 the provision is as hereunder. "Section 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 Motor Vehicles Act, 1988 (59 of 1988) or the rules made thereunder." (Also underlined to emphasise) 8. A Bare reading of the above definitions of "tour operator service" would go to show that primary engagement or activity or business of a person is that of planning, scheduling, organis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e also covered. Therefore, the phrase used within the brackets is clarificatory in nature and cannot be said to enhance the scope of the term tour operator." (Underlined to emphasise) We must place it on record that the above noted submissions carry the proper interpretation and give a proper meaning to the definition of "tour operator service", which is admittedly not being carried out by the Appellant as a service provider, since conducting tour by tourist vehicle having permit is a condition precedent to include arrangement for accommodation and not such arrangement of accommodation would alone put the service in the category of "tour operator service" and therefore, SCN justifying activity of the Appellant falling under the category of "tour operator service" only because the word "accommodation" is used in the definition, is a mere allegation and substantiation of the same by the Commissioner is erroneous as not in conformity to the statutory provisions. On this ground alone Appellant succeeds in its appeal. 9. Next comes leviability of Service Tax on the alleged service of providing hotel accommodation by the Appellant. Consistently Appellant is a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... om to Mr. Nilesh K. Chheda. Appellant's discharge of Service Tax on this Rs.1650/- is not disputed by the Department but the confirmation of demand was made on the entire amount of Rs.12,650.00/-, that was collected by the Appellant from the customer. Appellant asserts that this demand is illegal for the reason that on Rs.1650/- that was received by it as commission, tax was already paid and demanding tax on it even constitute a small component would amount to double taxation, which no law of the land would approve of and on Rs.11,170/- that was admittedly acknowledged by the Taj Hotel to have been realised for room accommodation in their hotel was not taxable during the relevant time as Section 65(105)(zzzzw) was brought into the Service Tax statute by way of amendment to Finance Act made w.e.f. 01.05.2011, making hotel room accommodation liable to Service Tax and the period of dispute ends on March 31, 2011, much before introduction of the said levy and therefore, whether the amount was collected by the Appellant and gone to the hotel or directly paid to the hotel is of no consequence to the Revenue. 10. It is noticed that learned Commissioner had avoided to gi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g the participating hotels to charge the value of rooms plus taxes, as applicable, from the guest/customers at the time of checkout clearly takes itself completely outside the purview of service defined under hotel accommodation apart from the fact that no consideration was flowing from the customers of the hotel to the Appellant towards such accommodation service. 11. Appellant has also challenged the invocation of extended period throughout the proceedings and the grounds raised by the Appellant are noted above as the submissions made by the learned Counsel for the Appellant in the preceding paragraphs. Going by the submissions made in para 11.4 of its written submission filed on 25.04.2024, series of communications were stated to have been made by the DGCEI intelligence and the Respondent-Department with the Appellant in between 05.10.2006 and 21.04.2011 numbering about 13 correspondence and learned Counsel for the Appellant has drawn out attention to some of the letters including the one issued by the Respondent-Department on 26.11.2008 asking for financial accounts like Balance Sheet and Profit & Loss Account and the other one issued by the Respo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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