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TMI Blog2020 (9) TMI 295X X X X Extracts X X X X X X X X Extracts X X X X ..... x credit whereas second condition is related to criteria for inclusion of charges of accommodation and transportation in the bill of a tour operator; and The second condition clearly emphasise that a bill issued by a tour operator for supply of its services should be inclusive of charges of accommodation and transportation required for such a tour. The conjunction and clearly explains that accommodation and transportation, both are must elements for a tour whereas conjunction or may have rendered option between accommodation and transportation. The applicant is rendering only transportation with some ancillary services and not accommodation, as such does not satisfy the conditions as mentioned under Serial No. 23 (i) {Chapter heading 9985} of Notification No. 11/2017-Central Tax (rate) dated 28.06.2017 (as amended), therefore, rate of GST 5% is not applicable. X X X X Extracts X X X X X X X X Extracts X X X X ..... services together provided by the Applicant to the Tourist i.e. local transportation services along-with services like guide, elephant ride, local sightseeing. Thus, the amount charged from Main Tour Operator will be inclusive of charges in respect of all the services which are provided by the Applicant to the tourist. A sample copy of the service order in respect of the transaction which the Applicant intents to undertake and the copies of the invoice raised by the Applicant have been already submitted with the application; 3. that under Section 9 of the Central Goods and Services Tax Act, 2017 (hereinafter referred as 'CGST Act), the Central Government by way of Notification shall prescribe the rate of central tax which shall be applicable on supply of goods or services or both. Pursuant to Section 9 r/w Section 11, 15 and 16 of the CGST Act, the Central Government vide Notification No.11/2017- Central Tax (Rate) dated 28.06.2017 (hereinafter referred as 'Rate Notification') notifies rate of 2.5% on supply of Tour Operator services under Heading 9985(i) subject to certain conditions. Similar rates have been prescribed under Rajasthan Goods and Services Tax Act, 2017 (Hereinafte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... raised a single invoice but charged rate of 5% on the local transportation services under heading 9964 and rate of 18% on sightseeing services, guide services, elephant ride services under heading 9985 (iii). However, it was pointed out by the service recipient i.e. Main Tour Operator that as per the market practice, when the local transportation services are provided along-with services like sightseeing, elephant ride, guide services, rate of 5% under heading 9985 (i) is applicable. Accordingly, the current advance ruling has been sought to get clarity on the said matter; 6. that whether the rate of 5% under heading 9985(i) is applicable on transaction which the Applicant intents to undertake wherein a single invoice is raised in respect of all the services i.e. local transportation services along-with services like sightseeing, tour guide, elephant ride etc., provided by the Applicant to Main Tour Operator?; 7. that to determine whether the services provided by the Applicant are covered under heading 9985(i), it has to be first analysed that whether the transaction which the Applicant intents to undertake falls under the phase 'supply of tour operator service'. For the same, i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng, scheduling, organizing, arranging tours (which may include arrangements for accommodation, sightseeing or other similar services) by any mode of transport, and includes any person engaged in the business of operating tours. 11. that as per the above definition, the Tour Operator must provide the transportation service. It is humbly submitted that in transaction at hand, the Main Tour Operator specifies the services which has to be provided to particular tourist or group of Tourist. Accordingly, the Applicant intents to organize and arrange the tour for the Tourist(s) which includes local transportation along-with sightseeing, elephant ride, guide services. Thus, It is submitted that as per the above definition, Applicant is a Tour Operator'; 12. that moreover, as per the Rate Notification, Tour Operator includes any person engaged in the business of operating Tours. The term business of operating tours' is very exhaustive and it will include any activity which are in the nature of incidental and ancillary to the business of operating tours like elephant ride, guide services, local sightseeing etc. Also, the annexure to the said Rate Notification i.e. list of Services, provide ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... said services to the tour operator. Thus, condition no. (i) is satisfied for the transaction which the Applicant intents to undertake; 18. that on perusal of condition no. (ii), it can be construed that the bill which is issued by the Tour operator should be inclusive of all the charges including charges of accommodation and transportation required for such a tour. The definition of the term 'tour operator' states that the person providing the tour operator's services may or may not provide the service of accommodation. Thus, it is humbly submitted on the co-joint reading of the condition no. (ii) with the definition of Tour Operator' and applying the rules of harmonious construction, it can be construed that the fulfilment of the condition of inclusion of accommodation charges in the bill of tour operator is required only when such services have actually been provided. However in those cases where such accommodation services have not been provided by the 'tour operator' then in those cases he is only required to issue bill which will include the gross amount charged for all the services i.e. transportation services provided along-with local sightseeing, elephant or other joy rid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Main Tour Operator? C. PERSONAL HEARING In the matter personal hearing was granted to the applicant through (Authorised video conference on 10.07.2020. Shri Rahul Lakhwani Representative) of applicant appeared for personal hearing. During the personal hearing, he reiterated the submissions already made in the application. He further requested that the case may be decided at D. COMMENTS OF THE JURISDICTIONAL OFFICER: The jurisdictional officer i.e. the Deputy Commissioner, State Tax, Circle-B, Jaipur Zone-III, Zonal Kar Bhawan, Jhalana Doongri, Jaipur, Rajasthan 302004 has submitted his comments vide letter dated 19.05.2019 which can be summarized as under-: The services supplied by the applicant to the Main Tour Operator falls under SAC heading 9985 (ii) [support services] other than heading 9985 (i). So the tax rate applicable on single invoice raised by the applicant is 18% (CGST 9% + 9% SGST). E. FINDINGS, ANALYSIS & CONCLUSION: 1. While going through the submissions made by the applicant, we find that the applicant is involved in supply of local transportation service and services like elephant ride, guide services and sightseeing to tourists engaged by various tour o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the same line of business (i.e. tour operator service procured from another tour operator)] 48 has not been taken [Please refer to Explanation no. (IV)]. 2. The bill issued for supply of this service indicates that it is inclusive of charges of accommodation and transportation required for such a tour and the amount charged in the bill is the gross amount charged for such a tour including the charges of accommodation and transportation required for such a tour. The said entry defines Tour Operator as "any person engaged in the business of planning, scheduling, organizing, arranging tours (which may include arrangements for accommodation, sightseeing or other similar services) by any mode of transport, and includes any person engaged in the business of operating tours.". On examination of above definition, we find four elements in the definition; tour operator is a person, who; * plan, schedule, organize and arrange tours; * might be providing accommodation, sightseeing and other similar services; * engaging any mode of transport for above services; * engaged in business of operating tours. Further, the above said Notification also delineates two conditions for a to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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