The New Delhi bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) reduced the demand for service tax imposed on tour operator service by invoking the extended period on the ground of limitation.
Hans Travels, the appellant assessee was engaged in providing daily passenger transport service from one state to another i.e. Interstate or Intrastate Passenger Transport service.
The assessee appealed against the order passed by the Commissioner for confirming the service tax demand of Rs.98,424/- in respect of booking commission, Rs.1,11,82,698/- for Tour Operator, and Rs.9,18,286/- in respect of luggage booking was proposed.
Ankur Upadhyay, the counsel for the assessee contended that the impugned order is beyond the scope of show cause notice and the allegation in show cause notice was that since the bus permit issued to the assessee is of Contract Carriage/ Tourist and confirmed the demand on a completely different ground.
Further submitted that the receipts are on account of sale of tickets for daily passenger inter state transportation of passenger and not from any “Tour Operator Services”.
Harshvardhan, the counsel for the department relied on the decisions made by the lower authorities and contended that the impugned service rendered by the appellant using a contract carriage would fall under the category of tour operator service and the argument that the impugned order had become infructuous as it had traversed beyond the scope of show cause notice was not legally tenable and liable to be rejected.
The Bench observed that the exemption was available to the service of tour operators for inter- state or intrastate transportation of passengers, other than for tourism, even for vehicles plying with tourist permits.
The two-member bench comprising Dilip Gupta (President) and Hemambika Proya (Technical) upheld the demand for the normal period and quashed the demand for the extended period on the ground of limitation.
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