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Issues:
Appeal against service tax and penalties under the Finance Act, 1994 for rent-a-cab operators. Analysis: The appellants, engaged in providing rent-a-cab services, were not registered under Service Tax Laws, leading to a show cause notice for evading service tax. The dispute revolved around the requirement of a license for rent-a-cab operators under the Motor Vehicles Act, 1988, which was dispensed with post-1998 amendment. The authorities found that service tax was applicable to rent-a-cab operators from 1-4-2000, as confirmed by the Madras High Court and upheld by the Supreme Court. The argument that the appellants did not provide rent-a-cab services as they retained custody of the cabs was countered by the definition of rent-a-cab scheme operator under the Finance Act, 1994. The Motor Vehicles Act empowered the Central Government to regulate renting motor cabs, with a scheme in place. The contention that the appellants were not licensees under the scheme was dismissed due to the legislative changes regarding service tax laws. The definition of rent-a-cab scheme operator under the Finance Act was crucial, covering taxable services related to renting cabs. The argument that rent-a-cab services required handing over the cab key to the customer was analyzed in the context of the Motor Vehicles Act, concluding that providing cabs with drivers still falls under the rent-a-cab scheme operator definition. Regarding the appellants' financial hardship plea, the tribunal found it unsubstantiated due to their operation of multiple cabs. Despite this, an interim stay of penalty amounts was granted, subject to the appellants depositing the entire service tax within eight weeks. Failure to comply would result in dismissal of the appeal. The tribunal scheduled compliance for November 15, 2006, disposing of all applications accordingly.
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