Customs, Excise and Gold Tribunal - Ahmedabad
Cce And C vs Gandhi Travels on 28 February, 2007
Equivalent citations: [2007]11STJ68(CESTAT-AHMEDABAD), [2007]8STT161, (2007)8VST276(CESTAT-AHD)
ORDER M.V. Ravindran, Member (J)
1. This appeal is filed by the Revenue against Order-in-Appeal dated 12.1.2006.
2. The issue involved in this case is regarding applicability of Service Tax under 'Tour Operator' category to the vehicles operated by the respondent. The learned Commissioner (Appeal) in his Order-in-Appeal has held that 4 vehicles having registration Nos. GJ6 X-9106, GJ6X-9119, GJ6X-9169 and GJ-6X-9140 are not tourist vehicle and do not fall within the scope of tourist vehicle and hence any operation conducted by these 4 vehicles would not get covered under the category of 'Tour operator' under Section 65(52) of the Finance Act, 1994. It is against these findings that the Revenue has come up in appeal before us.
3. Learned SDR submits that the vehicles which are being plied by the respondent would be covered within the definition of tour operator inasmuch that the said vehicles are 'contract carriage' and they are engaged in the business of operating tours between two destinations. It is also his submission that the issue is squarely covered against the respondent by the judgment of the Hon'ble High Court of Madras in the case of Secy. Federn. of Bus-Operators Assn. of T.N. v. UOI reported at and Sri Pandyan Travels v. CCE, Chennai-II reported at It is his farther submission that the learned Commissioner has erred in coming to the conclusion that these 4 vehicles would not get covered under the category of services provided by tour operators.
4. Learned Advocate on behalf of the respondents take us through the Order-in-Appeal and submits that the issue has been correctly decided by the learned Commissioner (Appeals). It is his submission that the vehicles which are in question were never given a registration as tourist vehicle and cannot be considered as tourist vehicles as defined under Section 65(52) of the Finance Act, 1988 read with Section 2(43) of Motor Vehicle Act read with Rule 128 of Central Motor Vehicle Rules, 1989. It is his submission that for the purpose of imposing service tax on tour operator it is first and foremost that tour should be operated by a tourist vehicle. He submits that case law relied upon by the learned SDR, on the contrary supports his case.
5. We gave anxious hearing to both the sides and considered the submissions made at length by both sides. At the outset it has to be decided whether the learned Commissioner (Appeals) was correct in coming to the conclusion that 4 vehicles which are in question are out of the ambit of 'tourist vehicle' or not. It can be seen that Section 2(43) of the Motor Vehicle Act, 1988 defines tourist vehicle as under:
(43) "tourist vehicle" means a contract carriage constructed or adapted and equipped and maintained in accordance with such specification as may be prescribed in this behalf;
It can be noticed on careful reading of the above reproduced section that a 'tourist vehicle' has to conform to the specifications given under Rule 128 of Central Motor Vehicle Rules, 1988. The said Rule 128 of Central Motor Vehicle Rules specifies various special conditions as regards dimensions, structures, passenger entrance and exit, emergency doors, windows, driver entry and exit, etc. From the perusal of the said Rules it is very clear that to get a vehicle registered as tourist vehicle the assessee has to first conform the vehicle to specifications given under Rule 128 of Central Motor Vehicle Rules, 1988.
6. It can be seen and noticed from the impugned order that the respondent had, in fact, produced certificate issued by Vehicle Registering authority i.e. State Transport Authority that 4 vehicles which are in question were covered under Section 2(7) of the Motor Vehicle Act as a contract carriage but they were not covered under Section 2(43) of the Motor Vehicle Act as 'tourist vehicle'. On such evidence being produced before the Commissioner (Appeals), learned Commissioner (Appeals) has held that these 4 vehicles would fall out of ambit as a 'Tourist Vehicle' and granted relief to the respondents. We find that the Revenue has not produced any contrary evidence before us to indicate that the vehicles in question are not tourist vehicles.
7. Coming to the judgment cited by the learned SDR, we find that the Hon'ble High Court of Madras in the case of Secy. Federn. of Bus-Operators Assn. of T.N. (supra) in para 14 has held as under:
We have, therefore, no hesitation first to hold that the first and foremost condition for a person to be held as "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 "tourist vehicle" in terms of Section 2(43) of the Motor Vehicles Act and in no other type of vehicle and, therefore, necessarily such vehicle must conform to the conditions prescribed under Rule 128 of the Central Motor Vehicles Rules.
Their Lordships have categorically held that first to hold for a person to be considered a tour operator, he must be operating a tourist vehicle in terms of Section 2(43) of the Motor Vehicle Act read with Rule 128 of Central Motor Vehicle Rules. The evidence produced before the lower authorities and before us indicate that the respondent is not operating 'tourist vehicles' as per Section 2(43) of Motor Vehicle Act, read with Rule 128 of Central Motor Vehicle Rules.
8. The judgment relied upon by the learned SDR in the case of Sri Pandyan Travels (supra) would in fact support the respondent's case, as correctly contended by the learned Advocate. We may reproduce the observation of the High Court which is as under:
Inasmuch as the petitioner is a contract carriage operator and not a stage carriage operator, the observation of the Division Bench in respect of "spare buses of stage carriages" is not applicable. It is also relevant to refer once again the observation in Para 41 ".... In fact, the most of the petitioners, who are having the contract carriage, are having the permits, under Section 88(9) of the Motor Vehicles Act read with Section 82, which are nothing but tourist "tourist permits" issued for the purpose of promoting the tourism and obviously issued to the tourist. Whereas contemplated under that section. Therefore, there will be no question of entertaining their objections and they will straightaway be covered under Section 65(52) of the Finance Act....
On the reading of the above reproduced portion of the judgment of the Hon'ble High Court it can be seen that the Hon'ble High Court came to the conclusion based on the fact that the petitioner therein were holding permits under Section 88(9) of the Motor Vehicle Act, read with Section 82. The provisions of Section 88(9) of the Motor Vehicle Act reads as under:
(9) Notwithstanding anything contained in Sub-section (1) but subject to any rules that may be made by the Central Government under Sub-section (14), any State Transport Authority may, for the purpose of promoting tourism, grant permits in respect of tourist vehicles valid for the whole of India, or in such contiguous States not being less than three in number including the State in which the permit is issued as may be specified in such permit in accordance with the choice indicated in the application and the provisions of Sections 73, 74, 80, 81, 82, 83, 84, 85, 86 of Sub-section (1) of Section 87 and Section 891 shall, as for as may be, apply in relation to such permits.
A plain reading of the above Sub-section would indicate that tourist permit is granted to an operator if he has tourist vehicles. Hence the tourist vehicle has to be read in line with the Section 2(43) of Motor Vehicles Act and Rule 128 of Central Motor Vehicles Rules. We have already held that the respondent's four vehicles did not answer to the description of 'tourist vehicles'.
9. The fact in the current case is that the 4 vehicles were never run as tourist vehicles, as envisaged under Section 2(43) of Motor Vehicles Act.
10. Accordingly, considering the facts and circumstances of the case we hold that the learned Commissioner (Appeals) order is correct and does not require any interference. Appeal filed by the Revenue is dismissed.
(Dictated & pronounced in the Open Court.)