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TMI Blog2015 (11) TMI 834X X X X Extracts X X X X X X X X Extracts X X X X ..... llant-company with individual drivers is referred to as a subscriber agreement wherein driver is termed as a subscriber. Investigation was carried by the officers of DGCEI, as to whether services rendered by the appellant would be falling under the category of supply of tangible goods for use from 16.05.2008. After recording the statements of various responsible personnel of appellant, the officers of DGCEI concluded that by giving taxi to an individual driver for use, appellant has rendered the services which fall under "Supply of Tangible Goods for use" (hereinafter referred to as STGU), show cause notice dt. 20.10.2010 was issued for demand of the service tax for the period 16.05.2008 to 30.09.2010, invoking the extended period by alleging suppression, misstatement of facts, show cause notices dt 3.10.2011 and 20.10.2012 were issued for the period 01.10.2010 to 31.03.2012, and also directing appellant to show cause why demand of service tax along with interest be not confirmed, and penalties be not imposed on them. Appellant contested the show cause notice's on merits as well as on limitation in respect of the show cause notice dt. 20.10.2010. Adjudicating authority after fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and register their requirement of vehicle and promotional advertisements are issued by the appellants for promotion of their services and entire booking of the taxi for the passenger till the same is utilized by the passenger is monitored by the appellant. It is his further submission that the contract between the appellant and the driver is for collection of the charges is on behalf of the appellant. He would submit that as per agreement, every driver has to pay appellant a fixed amount on day to day basis, which is nothing but collection of the fare on behalf of the appellant. Explaining this, he submits that instead of asking the passengers to deposit the fare directly with the appellant, appellant authorizes the driver to collect the fees from individual passengers and hold it with him till end of day and at the end of the day in terms of agreement, driver deposits an amount into the account of the appellant. It is his submission that this contract has been misread by the adjudicating authority to hold that the appellant is providing STGU in form of handing over the taxi to the individual drivers. It is his further submission that agreement is for engagement of independent ser ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it is his submission that appellant on their own wrote to CBEC in 2009 seeking clarification on the applicability of service tax on the activities carried on by them and that the appellant has challenged constitutional validity of the services in the High Court. Hence, they were under bona fide impression that service tax liability may not arise. He would refer to the judgment of the Supreme Court in the case of South Gujarat Roofing Tiles Manufacturers vs. The State of Gujarat and Another (1976) 4 SCC 601 for the meaning of the expression "includes". He submits their appeal be allowed. 4. The ld. Spl. Counsel ShriV.K.Singh appearing on behalf of the Revenue would submit that as per Section 65(105)(zzzzj) of the Finance Act, taxable service means any service provided or tobe provided to any person in relation to Supply of Tangible Goods including machinery, equipment and appliances for use without transferring right of possession and effective control of such machinery, equipment and appliances. He would submit that the definition of STGU consists of three parts (a) Supply of Tangible Goods (b) For use (c) without transferring the right of possession & effective control. It is hi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt of some of their activities and did not give complete details. It would mean that the appellant had suppressed the activity of the services under STGU. It is his submission that the appeal be rejected as devoid of merits. 5. We have considered the detailed submissions made by both sides and perused the records. 6. Both sides have filed written submissions which are taken on record. 7. Before we revert to decide the issue, undisputed facts needs to be stated. Appellant is a Radio Taxi Operator and is functioning under Radio Taxi scheme which is as per the provisions of the law that grants permission for plying radio taxi in a particular area. It is also undisputed that in order to get a radio taxi/fleet taxi license, the operator is per-se required to be a company or a partnership firm or a society and definitely not an individual; operator must have minimum number of 500 radio taxi to put into operations; operator is required to obtain taxi permits from the concerned state authorities in their name and the fare to be charged by such radio taxi operator is fixed by the State Government based on deliberations along with the operator. It is also undisputed that the radio taxi op ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fer of the possession of the vehicle but physical transfer has taken place, but the effective control of such taxi still is in the hands of the appellant. This view of ours is based upon the fact that majority of the time, the taxi is booked by a call from customer to appellant's Call Centre. On the basis of the direction of the appellant, the driver of taxi in the vicinity of the passenger ferries him to his desired destination. It is also to be noted that the driver of radio taxi is not a permit holder and he does not have independent authorization for plying the vehicles and is allowed to take passengers on instructions and directions from the appellant only. Passenger or a customer contacts appellant for booking the radio taxi for the journey and if there is any deficiency of services, the appellant is hauled before the courts and not the driver as also for any misdemeanor of the driver. It can inferred be safely presumed after perusing the clauses of the agreement between the appellant and the driver, the driver is collecting the fare amount from the customer on behalf of the appellant, as fare invoice for the journey is created and issued in the name of the appellant. The ..... X X X X Extracts X X X X X X X X Extracts X X X X
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