Custom, Excise & Service Tax Tribunal
M/S. Svr Tours & Travels vs C.C.E., Hyderabad-Ii on 10 January, 2014
IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL CIRCUIT BENCH AT HYDERABAD Date of Hearing 10.01.2014 For Approval &Signature : Honble Mr. Justice G. Raghuram, President Honble Mr. P.R. Chandrasekharan, Member (Technical) 1. Whether Press Reporter may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982? No 2. Whether it would be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? Yes 3. Whether Lordships wish to see the fair copy of the order? Seen 4. Whether order is to be circulated to the Department Authorities? Yes Application No.ST/STAY/26117/2013 Appeal No.ST/25822/2013-CU[DB] [Arising out of Order-in-Original No.27/2012-Adjn(ST)(Commr.), dated 23.07.2012, passed by the C.C.E., Hyderabad-II] M/s. SVR Tours & Travels Appellant Vs. C.C.E., Hyderabad-II Respondent
Appearance Shri Seetharamaiah, Advocate - for the appellant Shri K. Sambi Reddy, DC (AR) - for the respondent CORAM: Honble Mr. Justice G. Raghuram, President Honble Mr. P.R. Chandrasekharan, Member (Technical) Final Order No._____________, dated 10.01.2014 Per Honble Justice G. Raghuram:
Heard Shri B. Seetharamaiah, Ld. Consultant for the petitioner/appellant and Shri Sambi Reddy, Ld. Deputy Commissioner, Authorised Representative for Revenue. At the stage of considering the petition for stay, since a very short issue is involved, we dispose of the substantial appeal itself. In the circumstances, we waive pre-deposit.
2. The appellant is the assessee and has preferred the appeal against the adjudication order dated 23.07.2012 passed by C.C.E.&S.T., Hyderabad-II. This order confirms service tax levy of Rs.1,93,87,293/-; apart from interest and penalties as specified therein including penalty of an equivalent amount as the service tax assessed, under Section 78 of the Finance Act, 1994 (the Act). The liability to tax, interest and penalties is confirmed on the premise and conclusion that the appellant had provided Tour Operator service during 01.04.2005 to 31.03.2010. The impugned adjudication order is culmination of the Show Cause Notice dated 22.10.2010.
3. The appellant obtained registration as tour operator service provider in 2001. Intelligence gathered/revealed that the appellant failed to remit service tax for providing tour operator service. Further investigations revealed that the appellant provided this taxable service during the period in issue by way of operating contract carriage buses from Hyderabad to Shridi, apart from providing the taxable service for various tours depending on availability of vehicles and willingness of tourists. The proprietor of the appellant responding to summons stated that the appellant was collecting amounts under various heads viz., Bus Collection, Bus Hire Charges, Luggage Receipts & Other Income and Professional Charges for leasing of bus carriages to marriage parties; that small amounts were received towards Luggage Receipts; other incomes from sale of scrap; and discounts received on purchase of bus chassis from an automotive manufacturer; and professional charges representing discount received from insurance companies on premia paid on its buses. No particulars or evidence in support of the several amounts received was however provided by the appellant before the adjudicating authority or during the proceedings. The appellant claimed exemption from liability to tax by relying on exemption Notification No.20/2009-ST, dated 07.07.2009. In para 19 of the adjudicating order, the Ld. Commissioner dealt with this contention and rejected the same by observing, and in our considered view rightly, that exemption Notification No.20/2009-ST excludes from the domain of exemption provided thereunder, services relating to tourism, conducted tours, charter or hire services; and since the appellant had provided buses on hire and was operating contract carriage vehicles for providing tours to Shridi, including accommodation and other services, these amounted to providing conducted tours and not mere inter-state or intra-state transportation of passengers; thus falling outside the scope of the exemption Notification. The Authority however granted abatement to the extent of 60% on the basis of Notification No.1/2006-ST, dated 01.03.2006, including only 60% of the gross consideration received and applying the applicable rate of tax on the balance 40%.
4. Suffice to notice that Tour is defined in Section 65 (113) of the Act to mean a journey from one place to another irrespective of the distance between such places. During the relevant period, 2005-06 to 2009-10, the definition of Tour Operator in Section 65 (115) is defined as 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 (or a contract carriage by whatever name called, covered by a permit, other than a state carriage permit), granted under the Motor Vehicles Act, 1988 or the rules made thereunder.
5. Since the service provided by the petitioner during the relevant period falls within the ambit of tour as defined in Section 65 (113); the petitioner falls within the ambit of the definition of tour operator defined in Section 65 (115); and the service provided by the petitioner falls within the ambit of the taxable service enumerated in Section 65 (115)(n), the petitioner cannot gainfully contend that it did not provide the taxable tour operate service.
6. Ld. Consultant for the appellant places reliance on the decision of Ld. Division Bench of the Tribunal in Usha Breco Ltd. Vs. CCE, Meerut [2007(6) S.T.R. 117 (Tri. - Del.)] to support his contention that the appellant did not provide the taxable tour operator service. In Usha Breco Ltd., the assesses appeal was allowed only on the basis of an earlier final order of the Tribunal in Service Tax Appeal No.s178-179/2005 reported in [2006 (4) STR 88 (T)]. That judgement had occasion to consider a facts situation where the tour is for visit to temples or in a tourist vehicle but in a ropeway Gondola. The Tribunal therefore held that the road link between the two boarding points is only an incidental link and cannot displace the pilgrimage as the tour.
7. On behalf of Revenue, reliance is placed on the judgement of the Madras High Court in Sri Pandyan Travels Vs. CCE, Chennai-II in 2006 (3) S.T.R. 151 (Mad.). The High Court placing reliance on its earlier decision in Secretary, Federation of Bus-Operators Association of Tamil Nadu Vs. Union of India in 2001 (134) E.L.T. 618 (Mds) concluded that the contract carriage was covered within the definition of Tour Operation. The High Court also observed that the earlier judgement in Secretary, Federation of Bus-Operators Association of Tamil Nadu Vs. Union of India supra has placed the matter beyond controversy since it was observed therein that contract carriage permits amount to tourist permits, within the ambit of the provisions of the Motor Vehicles Act, 1998.
8. In the light of the above analysis, we find no error in the adjudication order passed by C.C.E.&S.T., Hyderabad-II warranting appellant inference.
9. The appeal is therefore dismissed. No costs.
(Justice G. Raghuram) President (P.R. Chandrasekharan) Member (Technical) SSK -7-