2013 (6) TMI 445 - AT - Service Tax

Tour operator service - appellants have claimed that they have operated the vehicles from point to point and that such activities cannot come under the category of tour and that, they cannot be considered as Tour Operators. - Held that - the claim of the assessee cannot be accepted in the light of the decision of the Tribunal vide in the cases of Ideal Travels & Others 2012 (7) TMI 707 - CESTAT, BANGALORE - the activity is taxable. Regarding exemption - Held that - the appellants that the appellants are eligible for the exemption under Notification No. 20/2009. Therefore demand of service tax on this activity is also liable to be set aside.

Summary

Issues:
1. Interpretation of activities as Tour Operators Services
2. Demand of service tax under Business Auxiliary Services
3. Applicability of Notification No. 20/2009 for exemption
4. Invocation of extended period of limitation and imposition of penalty

Interpretation of activities as Tour Operators Services:
The appeal challenged the order confirming a demand of service tax under Tour Operators Services and Business Auxiliary Services. The appellant argued that their activities did not qualify as tour operators as they operated point-to-point buses and provided buses on lease, without organizing tours. However, the Tribunal referenced a previous decision stating that the appellants' activities fell under the definition of tour operators. The Tribunal rejected the appellant's claim and upheld the demand under Tour Operators Services.

Demand of service tax under Business Auxiliary Services:
The appellant also contested the demand under Business Auxiliary Services, claiming that the activities did not fall under this category. The Tribunal found that the appellants had undertaken ticket booking activities for other operators, which qualified as Business Auxiliary Services. The Tribunal sustained the demand under Business Auxiliary Services based on the services rendered by the appellants.

Applicability of Notification No. 20/2009 for exemption:
The appellant relied on Notification No. 20/2009, seeking exemption from service tax under Tour Operators Services. The Tribunal considered the retrospective application of the notification and set aside the demand under Tour Operators Services, granting the appellant the benefit of the exemption.

Invocation of extended period of limitation and imposition of penalty:
Regarding the invocation of extended period of limitation and imposition of penalties, the Tribunal directed the original authority to reconsider the quantum of the demand under Business Auxiliary Services. The Tribunal instructed a review of the penalty imposition and extended period of limitation, providing the appellants with a reasonable opportunity for submissions. The Tribunal disposed of the appeal by setting aside the demand under Tour Operators Services, sustaining the demand under Business Auxiliary Services, and ordering a reassessment of the quantum of tax leviable under Business Auxiliary Services.