2017 (1) TMI 611 - AT - Service Tax

N/N. 20/2009-ST dated 07.07.2009 - tour operator service - rent-a-cab service - time limitation - Held that - the exemption for tour operator service as contained in N/N.20/2009-ST made available retrospectively w.e.f. 01.04.2000 is not available for examination by the lower authorities. The applicability of the said exemption to the appellants required re-verification of basic documents, more specifically the registration status of the vehicles operated by the appellants. In case the said exemption is found to be available to them, then the question of eligibility of small scale exemption for the other taxable service namely, rent-a-cab service also requires to be examined. The question of time bar also has to be examined in view of the submissions made by the ld. Counsel - appeal allowed by way of remand.

Summary

Issues:
1. Appellants' service tax liability under "tour operator service" and "rent-a-cab service."

Analysis:
The judgment involves three appeals against a common impugned order of Commissioner (Appeals), Indore, related to the appellants' service tax liability under "tour operator service" and "rent-a-cab service." The appellants claimed to be operators of stage carriers, but the impugned order held them liable for "tour operator service" due to their vehicles having a contract carriage permit. The appellants relied on exemption notification No.20/2009-ST, which exempted taxable services provided by a tour operator with a contract carriage permit from service tax. The exemption was made applicable retrospectively from 01.04.2000. The appellants argued that this exemption absolved them of tax liability.

Regarding the tax liability under "rent-a-cab service," the appellants contended that their overall turnover would be below the threshold limit for small-scale service due to the exemption claimed for tour operator service. They also disputed the demand on the grounds of time bar, stating that the notice did not indicate any suppression to warrant an extended period for demand. However, the revenue authority contested the appellants' claims, noting that the appellants had previously argued that they were not covered by a contract carriage permit.

The appellate tribunal observed that the lower authorities did not consider the retrospective exemption under Notification No.20/2009-ST while deciding the case. The tribunal highlighted the need to re-verify the basic documents, specifically the registration status of the appellants' vehicles, to determine the availability of the exemption. If the exemption applied, the eligibility for small-scale exemption for "rent-a-cab service" also needed assessment. Additionally, the tribunal emphasized the examination of the time bar issue based on the arguments presented by the appellants' counsel.

Consequently, the tribunal decided to remand the cases to the original authority for a fresh examination of the facts, supporting evidence, and a new determination on the merits. The appellants were directed to have a fair opportunity to present their case during the re-examination. As a result, all appeals were allowed by way of remand, providing a chance for a comprehensive review of the issues at hand.