Commissioner Of Central Excise, ... vs Trinty Travels

Customs Excise and Service Tax Appellate Tribunal22 July 2015

CitationAppeal No. 05/60-2009 dated 18/03/2009 passed by CC,CE&ST(Appeals-II), Hyderabad]

Ratio decidendi

The rule this decision rests on

A person who provides a taxable service is the one liable to pay service tax on it; where the assessee's vehicles were let out to other rent-a-cab operators who themselves rendered the rent-a-cab service to the customers, the assessee's leasing of its vehicles to those sub-contractors does not make the assessee the provider of the rent-a-cab service, and the mere fact that the sub-contractors may have failed to discharge their own service tax liability does not shift that liability onto the assessee, since the assessee has not rendered the service nor is letting out of vehicles to such sub-contractors shown to fall within the definition of rent-a-cab service.

Written by Miss Lucy from the judgment below, not taken from a headnote.

Judgment

As delivered

CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNALSOUTH ZONAL BENCHBANGALOREAppeal(s) Involved:ST/276/2009-DB

[Arising out of Order-in-Appeal No. 05/60-2009 dated 18/03/2009 passed by CC,CE&ST(Appeals-II), Hyderabad]

For approval and signature:

HON'BLE SMT. ARCHANA WADHWA, JUDICIAL MEMBER HON'BLE SHRI ASHOK KUMAR ARYA, TECHNICAL MEMBER

1 Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982? No 2 Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?

3 Whether Their Lordships wish to see the fair copy of the Order? Seen 4 Whether Order is to be circulated to the Departmental authorities? Yes

Commissioner of Central Excise, Customs and Service Tax HYDERABAD-II NULL L.B STADIUM ROAD, BASHEERBAGH, HYDERABAD, - 500004 ANDHRA PRADESH Appellant(s)

Versus

TRINTY TRAVELS, NO.1109,11TH STREET,SBI COLONY,GANDHI NAGAR HYDERABAD. Respondent(s)

Appearance:

Shri N. Jagdish, Superintendent(AR) For the Appellant

None For the Respondent

Date of Hearing: 22/07/2015

Date of Decision: 22/07/2015

CORAM:

HON'BLE SMT. ARCHANA WADHWA, JUDICIAL MEMBER HON'BLE SHRI ASHOK KUMAR ARYA, TECHNICAL MEMBER

Final Order No. 21682 / 2015

Per : ARCHANA WADHWA

Being aggrieved with the order passed by Commissioner(Appeals), Revenue has filed the present appeal. We have heard Shri N. Jagdish, Superintendent(AR) for the Revenue. Nobody appeared for the respondent.

2. As per the facts on record, the respondent is registered with the Service Tax Department under the category of rent-a-cab scheme operator service. They were discharging their service tax liabilities in respect of the services provided by him to the customers. However, on verification of the documents, Revenue found that they were also providing their cabs to the other rent-a-cab operators. Investigations were carried out with the other cab operators and it was found that out the of the 62 cab operators, to whom the respondent has sub-let his vehicles, 34 operators were not registered with the Department and out of remaining 28 registered operators, 15 operators had not discharged service tax liability on the cabs procured from the respondent.

3. In view of the above, a show-cause notice was issued to the respondent proposing confirmation of demand of tax, which stands adjudicated by the Joint Commissioner, confirming service tax to the tune of Rs.18,87,164/- along with education cess of Rs.18,576/- and imposition of penalties.

4. On an appeal against the said order, Commissioner(Appeals) observed that inasmuch as the appellant has only sub-let their cars to the other tour operators and inasmuch as it is the liability of the other cab operators to pay service tax, no liability can be fastened upon the present respondent. As such by referring to some decisions of the Tribunal, he concluded that the assessee is liable to pay service tax on the value of services rendered by them to the customers and that too subject to abatement of 60% from 09/07/2004 onwards. No service tax liability can be fastened upon him in respect of the cabs sub-let to the other cab agencies. He also set aside the penalties imposed upon. The said order is appealed against by the Revenue.

5. The Revenues only ground in the appeal is that inasmuch as the other cab operators, who have taken cars on rent from the present assessee have not discharged their duty liability and inasmuch as the present assessee has not produced any evidence on record to show that the other contractors have discharged service tax liability, the responsibility to pay the same would lie upon him. We find no merits in the above contention of the learned AR. The services have actually been provided by the other rent-a-cab operators and not by the assessee. The one who has provided the services is liable to pay the service tax. Merely because such service stands provided by the other sub-contractors by taking the respondents vehicle, will not shift the responsibility to pay service tax on the respondent. It is not the Revenues case that the respondent himself provided such services or letting of vehicles to the other sub-contractors is also covered by the definition of rent-a-cab service. As such, we find no merits in the Revenues appeal. The same is accordingly rejected.

(Order pronounced and dictated in open court)

ASHOK KUMAR ARYA TECHNICAL MEMBER ARCHANA WADHWA JUDICIAL MEMBER

Raja.

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