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2012 (6) TMI 141 - AT - Service TaxStay demand of service tax - Rent-a-cab service - cabs were let on hire on demand basis as and when made by users. Those were not provided by the appellant on fixed rental basis - Held that - if a cab operator provides a cab with driver to his client on demand and charges on km. basis, control of the vehicle always remaining with the cab operator, in that case he shall be said to have provided transport service instead of renting-a-cab. - Decision in R.S. Travels v. CCE 2008 (7) TMI 27 (Tri) followed. - Decided in favor of assessee.
Issues:
Interpretation of service tax liability for 'Rent-a-cab' services. Analysis: The judgment revolves around the interpretation of service tax liability concerning 'Rent-a-cab' services provided by the appellant. The dispute arose from a demand of service tax amounting to Rs. 32,220, which the appellant contested as not taxable. The Adjudicating Authority found that the cabs were provided on a hire-on-demand basis, rather than a fixed rental basis, leading to the conclusion that the service was not taxable. However, the first appellate authority reached a different conclusion, prompting the appellant to appeal the decision. Given the small amount in dispute, the Tribunal decided to hear both the Stay Application and the Appeal together for a common disposal. The Tribunal noted that the facts recorded by the Adjudicating Authority remained unchanged during the first appellate stage, with nothing in the first appellate order contradicting these facts. The Tribunal referred to a previous case, R.S. Travels v. CCE, where it was established that if a cab operator provides a cab with a driver on demand and charges on a per kilometer basis while retaining control of the vehicle, it constitutes a transport service rather than renting a cab. Based on the precedent set in the aforementioned case, the Tribunal granted relief to the appellant, concluding that the service provided fell under the category of transport service rather than 'Rent-a-cab.' Consequently, the Stay Application was disposed of, and the appeal was allowed in favor of the appellant.
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