2008 (12) TMI 49 - AT - Service Tax

Tour Operator appellant submission that he was plying vehicles which had Stage Carriage Permit and they cannot be treated as that of a contract carriage and therefore, they cannot come under the category of Tourist Vehicle and therefore, their activity cannot be treated as Tour Operator, is accepted - vehicles were never run as tourist vehicles , as envisaged under Section 2(43) of Motor Vehicles Act. Therefore, appeal is allowed

Summary

Issues:
Interpretation of the term 'Tour Operator' under service tax laws in the context of vehicle permits and operations.

Analysis:
The case involved an appeal against the order of the Commissioner (Appeals) regarding the classification of the appellants as 'Tour Operators' and the imposition of service tax. The appellants owned buses with Stage Carriage permits, using them to transport students. The original authority classified the appellants as 'Tour Operators,' leading to the imposition of service tax, interest, and penalties. The Commissioner (Appeals) upheld this decision. The appellant argued that their vehicles, with Stage Carriage permits, did not qualify as 'Tourist Vehicles,' hence they could not be considered 'Tour Operators.' The Tribunal considered relevant decisions, including one by the Hon'ble High Court of Madras, which emphasized the necessity of operating 'tourist vehicles' to be classified as a 'Tour Operator.'

The Tribunal analyzed the judgments cited by both parties, particularly focusing on the definition of 'Tour Operator' in relation to the type of vehicles operated. Referring to the decision in the case of Gandhi Travels, the Tribunal highlighted the requirement for a vehicle to meet the criteria of a 'tourist vehicle' as per the Motor Vehicles Act and Central Motor Vehicles Rules to qualify as a 'Tour Operator.' The Tribunal emphasized that the vehicles in question did not meet the criteria of 'tourist vehicles' under the relevant laws, hence concluding that the appellants could not be classified as 'Tour Operators.' The Tribunal allowed the appeal, providing consequential relief to the appellants based on the similarity of facts with the Gandhi Travels case.

In conclusion, the judgment clarified the interpretation of the term 'Tour Operator' under service tax laws, emphasizing the importance of operating 'tourist vehicles' as defined by the Motor Vehicles Act and Central Motor Vehicles Rules to fall under this category. The decision highlighted the necessity for vehicles to meet specific criteria to qualify as 'Tour Operators,' ultimately leading to the allowance of the appeal in favor of the appellants based on the lack of compliance with the required vehicle classification.