2024 (6) TMI 395 - AT - Service Tax

Levy of service tax - amounts collected for performing tour operator services - canter ride charges - movie shooting charges - camping and angling charges - short term accommodation service - HELD THAT - These issues have been decided by this Tribunal Principal Bench in the case of Dy. Conservator of Forest and Dy Field Director vs. Commissioner of Central Excise, Jaipur 2018 (4) TMI 777 - CESTAT NEW DELHI where it was held that ' We are of the view that Forest Department has the mandatory duty to protect the environment and to safeguard forests and wild life. Amounts recovered by them towards issue of entry permits as well as vehicles which have also been credited to the State Treasury are to be considered in the nature of fee or amount collected as per the provisions of relevant statute for performance of statutory functions. This cannot be considered as consideration for purposes of organizing tour.' In the present case facts are identical, appellant is also same and that there are no reason to differ from these findings - the order under challenge is set aside. Appeal allowed.

Summary

Issues:
1. Liability to pay service tax for amounts collected for tour operator services (canter ride charges, movie shooting charges, camping and angling charges).
2. Liability to pay service tax for providing short term accommodation service.

Analysis:
The appellant, engaged in tour operator and short term accommodation services, was registered with Service Tax Range Haldwani. The appellant organized tours to Corbett National Park, granting permits for vehicles and charging fees from tourists. The Department alleged the appellant provided tour operator services and collected money for various activities and short term accommodation. A demand of Rs.34,16,003 under "Tour Operator Service" and "Short Term Accommodation Service" was raised for the period December 2009 to March 2014, with penalties. The adjudicating authority dropped the demand for entry fees but upheld demands for canter rides, movie shooting, camping, angling, and accommodation, leading to the appeal.

The appellant did not appear during proceedings, and the Department's representative acknowledged the issue favored the assessee. The Tribunal considered the issues of liability for service tax on tour operator services and short term accommodation. Referring to a previous case, it was noted that fees collected for mandatory functions under wildlife protection laws were not considered services for tax purposes. The Tribunal held that the amounts collected by the appellant were akin to fees for statutory functions under the Wildlife Protection Act, not for organizing tours. Consequently, the demand for service tax was deemed unjustified, and the appeal was allowed, setting aside the original order.

In conclusion, the Tribunal found the appellant not liable to pay service tax for the amounts collected for tour operator services and short term accommodation. The decision was based on the nature of the fees collected, deemed to be for statutory functions under wildlife protection laws, rather than for organizing tours. The appeal was allowed, and the original order was set aside, with the judgment pronounced on 07/06/2024.