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TMI Blog2011 (11) TMI 264X X X X Extracts X X X X X X X X Extracts X X X X ..... ion 20/09-ST, dated 07-07-09 and provisions of section 75 of Finance Act, 2011, providing for exempting the taxable service provided by a tour operator having a contract carriage or tourist vehicle. In such a scenario, no mala fide can be attributed to the appellant with an intent to evade payment of duty. Accordingly, the invokation of penal provision against the appellants is not justified. The penalty imposed u/s 76 and 78 of Finance Act, 1994 upon him are accordingly set aside. - Decided partly in favor of assessee. - ST/114 OF 2006 - ST/594 OF 2011 - Dated:- 16-11-2011 - MS. ARCHANA WADHWA, AND SHRI MATHEW JOHN, JJ. Represented by: Shri B.L. Narasimhan for the Appellant. Shri Amrish Jain for the Respondent. ORDER Mathew John, Technical Member - The Appellant plies buses with Tourist Permits buses from Udaipur to various destinations. They book seats for individual customers either themselves or through booking agents. Their books of account showed a single entry for collection of charges for each trip on every day. The buses which they use were having permit for Tourist Vehicles and were not licensed as Stage Carriers as envisaged in Motor Vehicles Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... journey for one place to other. From the said discussion your Honour kindly will observe that we are engaged in carrying passengers from one place to other and not engaged in carrying tourist. It is a business of stage carrier a similar to the business as undertaken by State Transport undertakings." 4. In support of their case they rely on the decision of the Tribunal in the case of Usha Breco Ltd. v. CCE [2007] 8 STT 191 (New Delhi - CESTAT). In that case the appellant was operating several ropeways from Hardwar to both Mansa Devi and Chandi Devi temples. The boarding points for the two ropeways were located at a distance of about 4 kms. The pilgrims visited the temples by using ropeways. The appellant was selling ropeway tickets for single journey to one temple or a combined ticket for journey to both the temples. A combined ticket included the cost of road journey from one ropeway boarding point to the other rope-way boarding point. A sample ticket showed that the charge for two ropeway rides is Rs. 109/- and charge for road transit is Rs. 26/-. The road journey was provided in Maxi Cabs which satisfy the definition of 'tourist vehicle' under the Motor Vehicles Act. Revenue de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nder Tourist Permits or not. (iii) Prakash Poonam Tours Travels v. CCE [2009] 23 STT 28 (New Delhi - CESTAT) This is a case where the bus was used for carrying employees of Rajasthan State Mines Minerals Ltd. through its buses from Udaipur to Jhamarkotra, Jhamarkotra to Kharwachanda and vice versa. (iv) CST v. Patel Tours Travels [Final Order No. A/1432 of 2010 - WZB/Ahd., dated 15-7-2010] This is a case where the vehicle was having a permit as contract carriage and not as tourist vehicle. 7. Another argument raised by the Counsel for the Appellant is that if at all there is any violation of Motor Vehicle Rules in operating Tourist Vehicles as stage carriers that is not a matter that can be looked into in a proceeding relating to levy of service tax. 8. Ld. SDR on the other hand argues that the activity carried out by the Appellants fits exactly into the definition of tour operator as given in section 65(113) of Finance Act, 1994 at the relevant time. The definitions relevant for deciding the dispute are reproduced below: "(113) "Tour" means a journey from one place to another irrespective of the distance between such places. (114) "Tourist Vehicle" has the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of the petitioners, who are having the contract carriage, are having the permits under Section 88(9) of the Motor Vehicles Act read with Section 82, which are nothing but "tourist permits", issued for the purpose of promoting the tourism and obviously issued to the tourist vehicles as contemplated under that section. Therefore, there will be no question of entertaining their objections and they will straightaway be covered under Section 65(52) of the Finance Act. Such petitions, where the permits are under Section 88(9) of the Motor Vehicles Act, would be straightaway liable to be dismissed and are dismissed as such." "55. As it is, majority of the petitioners are having the "tourist permits" under Section 88(9) of the Motor Vehicles Act read with Rules 82 to 85 of the Rules framed thereunder. Such persons can never contend that the Act is not applicable to them but, even others who are simply engaged in the business of renting the cabs would come in the tax-net." 10. There have been a large number of decisions in the matter of scope of the entry for "tour operator". But most of them are centred around the type of permit that the operator was having or the type of vehicle the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as "stage carrier". He was licensed as a "tour operator". The Appellant was selling its services as a "tour" for the obvious reason the Appellant could not have sold its services as a stage carrier. A stage carrier is bound by the rates for ticket approved by the government for such carriers and they have to pay taxes under Motor Vehicle Act as applicable to stage carriers and have to comply with many other restrictions but a tourist operator is not bound by those. When the Appellant was holding out to be tour operator before the Road Transport Authorities and to its customers can it take a stand before an authority levying service tax that it was not conducting "tours"? 14. France Act, 1994 defines the expression "tour operator" by borrowing definitions in Motor Vehicles Act. So there is a need to understand the word "tour" in the same meaning for the purpose of both the Acts. The Appellant had no difficulty in understanding this word to cover his activity while complying with the provisions of Motor Vehicle Act but for purpose of complying with Finance Act, 1994 the Appellant feels that the word has different natural meaning which should be adopted. This is not an acceptable ar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ilar provisions in Central Excise Act, 1944. 16.3 In this case there is also an issue that the Appellant did not furnish the facts and figures as necessary for issuing the SCN and was suppressing the information. Without these figures a formal SCN could not have been issued. Admittedly there have been letters issued by Department on 28-08-2000 itself and later notifying the Appellant that tax liability would arise. The fact that the Appellant succeeded in not giving the required information for quantifying the tax liability cannot be a reason to plead that demand is time barred, considering that the statue does not count period of time from date of knowledge. If statute had such provision the issue as to what type of knowledge is relevant -whether it is the knowledge that the person concerned is evading tax or whether it is the knowledge of all the figures and evidence necessary for issue of SCN, would have arisen. In the facts of this case we are not able to agree with the contention that extended period under section 73 of Finance Act, 1994 cannot be invoked. 17. Further there is contention that the penalties imposed are excessive. We note that the adjudicating officer has im ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le to the facts of the instant case. Anyhow, I agree with learned brother that the demand for the period September, 1997 to 17.8.98 is required to be confirmed inasmuch as prior to 2004, the provisions of Section 73, under which the demands stands raised provided for invokation of longer period for non-filing of returns. Inasmuch as the appellants during the relevant period did not file Service tax returns and there being no condition of mala fide misstatement or suppression or collusion, etc. as available under Section 73, prior to 2004 for invokation of longer period, the demand cannot be held to be barred by limitation. 21. As regards the period April, 2000 to 23.12.2002, I find that notification No. 20/09-ST, dated 7.7.2009 was issued by the Government of India providing as under:- "In exercise of the powers conferred by sub-section (1) of section 93 of the Finance Act, 1994 (32 of 1994) (hereinafter referred to as the Finance Act), the Central Government, on being satisfied that it is necessary in the public interest so to do, hereby exempts the taxable service referred to in sub-clause (n) of clause (105) of section 65 of the Finance Act, provided or to be provided to any ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ole of service tax leviable under section 66 of that Act to any person by a tour operator having a contract carriage permit for inter-State or intra-State transportation of passengers, excluding tourism, conducted tour, charter or hire service, shall be deemed to have, and deemed always to have, for all purposes, validly come into force on and from the 1st day of April, 2000, at all material times. (2) Refund shall be made of all such service tax which has been collected but which would not have been so collected as if the notification referred to in sub-section (1) had been in force at all material times. (3) Notwithstanding anything contained in the Finance Act, 1994 (32 of 1994), an application for the claim of refund of service tax shall be made within six months from the date on which the Finance Bill, 2011 receives the assent of the President." 23. Thus, by virtue of Section 75 of the Finance Act, 2001 and in view of Notification No. 20/2009-St dated 7th July, 2009, no service tax is leviable in respect of the income earned by the appellants by carrying the passengers in a contract carriage for inter-State or intra-State transportation of passengers. Thus, even if it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enalties imposed upon the appellants are to be upheld with an option to pay 25% of duty as penalty as held by Member (Technical) or the penalties are required to be set aside as held by Member (Judicial)?" Mathew John, Technical Member 27. I have gone through the order recorded by Ld. Member (Judicial) and 1 find a need to revise my earlier order because it has not taken into account Notification 20/09-ST, dated 07-07-09 and provisions of section 75 of Finance Act, 2011. Once these are taken into account I agree with the said order and there is no scope for difference of opinion on the first point recorded above. However, I note that tax demanded for the period September, 1997 to 17.8.1998 is already quantified in the Annexure to the Show Cause Notice as Rs. 5,01,825/- which amount has not been disputed in these proceedings. 28. I also note that Government has accepted the need for keeping parity between buses having contract carriage permit and buses having stage carrier permit doing point to point transportation and has provided such parity with effect from 01-04-2000. So for the previous period this disparity can be considered as a reasonable cause for the failures of th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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