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2019 (2) TMI 881 - AT - Service TaxTout operator service - tourist vehicle or not - compliance with Rule 128 of the Central Motor Vehicles Act or Rules, 1988 - Held that - No evidence has been produced by the vehicle being used for the purpose of transportation of employees were issued permit as tourist vehicle under Rule 128 of Motor vehicle Rules, 1998. In absence of such permit the vehicle cannot be treated as tourist vehicle as held by Tribunal and upheld by Hon ble Apex Court in the case of Bharat Travels 2010 (7) TMI 471 - CESTAT, AHMEDABAD - appeal dismissed - decided against Revenue.
Issues:
1. Confirmation order upholding the dropping of proceedings against a company for Service Tax under the head of Tour Operator. 2. Interpretation of the term "Tourist Vehicle" under the Central Motor Vehicles Act and Rules. 3. Comparison of decisions by different authorities regarding the requirement of a tourist permit for a vehicle to be considered a tourist vehicle. 4. Application of past judgments in similar cases to the current scenario. Issue 1: The appeal was filed by Revenue against the confirmation order of the Commissioner, which upheld the decision of the Additional Commissioner to drop proceedings against a company, M/s Shreenath Travellers, for Service Tax under the category of Tour Operator. The Commissioner determined that the vehicles used by the company did not qualify as tourist vehicles due to not holding a tourist vehicle permit from the transport authority. Issue 2: The Commissioner relied on the decision of the Hon'ble High Court of Madras regarding the definition of a tourist vehicle under Rule 128 of the Central Motor Vehicles Rules. The Commissioner emphasized that for a vehicle to be considered a tourist vehicle, it must conform to specific conditions outlined in the rule, such as dimensions, structure, seating arrangement, and other specifications. The Commissioner concluded that since the vehicles used by the company did not meet these conditions, they could not be classified as tourist vehicles, and thus, no tax could be levied under the category of Tour Operators. Issue 3: The argument presented by the Revenue's Assistant Commissioner highlighted the disagreement with the Commissioner's decision and pointed out that a tourist permit was not necessarily required for a vehicle to be considered a tourist vehicle under the Motor Vehicles Act. The Assistant Commissioner referenced a summary of a judgment by the Hon'ble High Court of Madras to support this argument. Additionally, the Assistant Commissioner mentioned the challenge to a previous decision by the Hon'ble High Court of Gujarat, which was subsequently set aside by the Hon'ble Apex Court. Issue 4: The respondent's counsel argued that the case was similar to previous decisions by the Tribunal, such as Rajan Travels, Patel Tours & Travels, and Bharat Travels, which had been upheld by the Hon'ble Apex Court. The Tribunal's decision in the case of Bharat Travels emphasized the requirement of a permit granted under the Motor Vehicle Act for a vehicle to be considered a tourist vehicle. The Tribunal's decision was upheld by the Hon'ble Apex Court, distinguishing it from the Hon'ble High Court of Madras's decision. In conclusion, the Tribunal dismissed the Revenue's appeal, affirming that without evidence of the vehicles being issued a permit as a tourist vehicle under Rule 128 of the Motor Vehicle Rules, the vehicles could not be classified as tourist vehicles. The judgment highlighted the importance of meeting specific criteria outlined in the Motor Vehicle Rules to qualify as a tourist vehicle for taxation purposes.
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