A single Judge bench of the Kerala High Court has held that the Contract Carriages which are used for the purpose of tour are liable to pay Service Tax under the provisions of the Finance Act, 1994.
While dismissing the petition filed by the assessee, Mr. V.K.Rakesh, R.R Travels, Justice A.M Shaffique confirmed that the services rendered by the assessee are chargeable to Service Tax under the head “Tour Operator”.
The grievance of the petitioner was that they are aggrieved with the order of the Service Tax Department stating that the petitioners comes under the Service Tax for the services rendered by them comes under the head “Tour operator”.
The petitioners impugned the order of the Department on ground that they are engaged in the business of letting contract carriage vehicle on hire as per the requirements of customers. They claims that they are not providing any other service other than giving on hire the vehicle.
The bench noted that as per the impugned order, the assessee was operating the tours conducted on the vehicles owned by them and they are not mere owners of contract carriages let on hire to customers. The staff of the carriage including the driver is operating the trips and tours. The carriages are used for marriage parties, excursions and group trips. It is not a mere instance of hiring of contract carriage. Further, the vehicles are contract carriages as certified by the Transport Officer.
“Hence, it was found that the assessee was operating contract carriages for the purpose of tour, which is liable for service tax. It is therefore evident that, on facts, there is a finding that the assessee is providing service of the tour operator. When there is such a finding of fact, it may not be possible for this Court to interfere with the said finding especially when no steps had been taken by the petitioners to prefer an appeal as contemplated under the statutory provisions.”
Read the full text of the Judgment below.
