C.C.E., Allahabad vs S/O Shri Ram Adhar

1. Whether Press Reporter may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982? No 2. Whether it would be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? Yes 3. Whether Lordships wish to see the fair copy of the order? Seen 4. Whether order is to be circulated to the Department Authorities? Yes

Application No.ST/CROSS/240/2009-CU[DB]

Appeal No.ST/544/2009-CU[DB]

[Arising out of Order-in-Appeal No.25-ST/ALLD/2009, dated 88.04.2009 passed by C.C.E.(Appeals), Allahabad]

C.C.E., Allahabad Appellant

Vs.

Shri Alok Prakash

S/o Shri Ram Adhar Respondent

Appearance

Shri M.R. Sharma, DR - for the appellant

Shri SS Dabas, Advocate - for the respondent

CORAM: Honble Justice G. Raghuram, President

Honble Mr. R.K. Singh, Member (Technical)

Final Order No.52543/2015, dated 24.07.2015

Per Mr. R.K. Singh :

Revenue has filed appeal against Order-in-Appeal dated 08.04.2009 which set aside the order in original dated 10.05.2008. The primary adjudicating authority vide the said Order-in-Original confirmed a demand of Rs.45,247/- for the period April 2001 to September, 2002 along with interest and also imposed penalties under Sections 75, 76, 77 and 78 of the Finance Act, 1994 on the ground that the respondent had provided Tour Operator service to IFFCO is in-as-much-as, as per the contract entered with IFFCO, it transported the families and employees of IFFCO from one point to another at an agreed rate and in a luxury bus which had a permit issued under the Central Motor Vehicles Act, 1988 in relation to such vehicles.

2. The Commissioner (Appeals) held that the respondent did not satisfy the definition of Tour Operator and therefore was not liable to impugned service tax.

3. The Revenue has contended that as per Section 65 (52) of the Finance Act, 1994 Tour Operator was defined as under:-

Tour Operator means any person engaged in business of operating tours in a tourist vehicle covered by a permit granted under Motor Vehicle Act, 1988 or rules made thereunder.

Thus, the service rendered by the respondent clearly fell under the category of Tour Operator service and the respondent satisfied the definition of tour operator.

4. In its cross objections, the respondent contended that it was not engaged in the business of planning scheduling organising or arranging tours and was only engaged by IFFCO to carry their staff/families for marketing, schools and working shifts and general shifts from residential colony to factory/factory to residence and cited several judgements published in 2006 and 2007.

5. When the case was taken up for hearing, no one appeared on behalf of the respondent. The Ld. Departmental Representative cited the judgement of CESTAT in the case of Friends Tour & Travels Vs. CCE Noida [2014 (33) STR 585 (Tri.-Del.)] contending that the issue is squarely covered by the said judgement.

6. We have considered the contentions of Revenue and also of the respondent contained in the Memorandum of cross objections. The agreement of the respondent with IFFCO quoted in the Order-in-Original inter alia states as under:-

You will place at the disposal of IFFCO one Number of 52 sealer luxury bus model 1999. This will be used for transportation of men and material of IFFCO. Generally the vehicle will run between Phoolpur and Allahabad but sometimes it may required to go outside Allahabad also. In such cause you will arrange route permit for that destinations IFFCO will reimburse the charges for route permit when presented with monthly bills.

In terms of Section 65 (113) ibid tour means a journey from one place to another irrespective of the distance between such places. We can safely adopt this for our purpose. Thus, there is no doubt that the journey performed by the employees/families of IFFCO clearly fell under the scope of TOUR. The definition of tour operator given in section 65 (52) ibid quoted above clearly shows that the journeys organised by the respondent in its bus clearly made it a tour operator as the journey were organised in contract carriages which were duly granted permits under the Motor Vehicle Act, 1988. We find that the respondent in the cross-objections cited the judgements of Tamil Nadu State Transport Corporation Vs. CCE, Chennai [2006 (12) LCX 0152], Gayatri Enterprises Vs.2007 (01) LCX 0177] and Gautulal V. Patel Vs. CCE, Vadodara-II [2007 (05) LCX 013]. The CESTAT judgements in the cases of Tamil Nadu State Transport Corporation Vs. CCE, Chennai was delivered by a Single Member Bench and the judgement of Gayartri Enterprises is a judgement of Commissioner (Appeals). and therefore we are not going into the facts of these cases.

In the case of Gatulal V. Patel Vs. CCE, Vadodara-II (supra) it is stated that the vehicles in which the tour was performed should have conformed to the specification of a tourist vehicle. It is not the case of the appellant that its vehicle did not conform to such specifications. Other judgement of CCE, Vadodara Vs. Gandhi Travels [2007 )92) LCX 0051] cited is also similarly distinguishable. We find that the definition of tour operators during the relevant period covered persons engaged in business of operating tours in a tourist vehicle having a permit under the Motor Vehicle Act, 1988. In the present case there is no doubt that the service was rendered using luxury bus which was having permit under the Motor Vehicle Act, 1988 and the said bus was not a stage carriage but a contract carriage. Thus, the respondent provided tour operator service. Indeed the issue is squarely covered against the respondent by CESTAT judgement in the case of Friends Tour & Travels Vs. CCE Noida (supra) wherein it was held that the activity of providing buses to LG Electronics for dropping of staff was covered under definition of tour and the assessee was covered under the definition of tour operator and was liable to pay service tax under Section 65 (105) (n) read with Section 65 (115) ibid.

7. In the light of the aforesaid analysis, we allow Revenues appeal, set aside the Order-in-Appeal and restore the Order-in-Original dated 13.05.2008. The memorandum of cross objections also stands disposed of.

(Justice G. Raghuram)

President

(R.K. Singh)

Member (Technical)

SSK

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