MRS. PRASEETHA SURESH Vs. COMMISSIONER OF CENTRAL

JUDGEMENT

(1.) THE appellants are challenging the revision order No. 1/05 ST dated 8.4.2005 passed by the Commissioner of Central Excise, Thiruvananthapuram holding the appellants to be Tour Operator and liable for Service Tax in terms of Section 65(78) of Finance Act. The Commissioner has also imposed penalty. The appellants had been issued with a show cause notice No. 238/02 (ST) dated 30.5.2002 calling upon the appellants to explain as to why they should not be imposed with penalty for not having been registered in the category of Tour Operator. This show cause notice was dropped by the Deputy Commissioner by Order -in -original No. 50/03 dated 9.4.2003. The Commissioner did not initiate action for review till 1.4.2005, on this day show cause notice No. 1/05 (ST) was issued calling upon the appellants to explain as to why penalty should not be imposed for not having registered themselves as Tourist Operator. Reference to the earlier show cause notice dated 30.5.2002 has also been made. In both the show cause notices, the period of demand and the Service Tax has not been quantified.

(2.) THE appellants took the stand that the proceedings initiated is not as per law and inasmuch as the Service Tax is concerned, the demands have not been quantified and specified in both the show cause notices. It is further submitted that they were not tourist operators but they had only registered as contract vehicle. They referred to the provisions of Rule 128 of Motor Vehicles Rules 1989 read with Section 2(43) of Motor Vehicles Act 1988. They pointed out that to be a tourist vehicle, they have to satisfy the specifications given in Rule 128 of Motor Vehicle Rules for a tourist operator in respect of dimension structure, door, etc. They contended that in terms of RC book held by them for the single vehicle, the vehicle did not specify the said specification and hence, they are not tourist operators. They drew attention to the Madras High Court judgment rendered in the case of Secretary Federation of Bus -Operators Association of T.N. v. UOI , wherein in para 36 of the judgment, the Hon'ble Court has clearly laid down that the tourist vehicles have to satisfy the specifications laid down under Rule 128 read with Section 2(43) of Motor Vehicles Act. The High Court remanded the matter to the authorities to examine the specifications of the vehicle in the light of the said Rule. It was held that to be a tourist vehicle in terms of the said Section and Rule, it has to satisfy the specifications which is sine qua non for registration under Finance Act. The Commissioner's proceeding to hold that the vehicle as tourist vehicle was solely on the basis of the appellant having registered as a contract vehicle.

(3.) THE learned Counsel attacks the order on the ground that their vehicle does not satisfy the specifications of a tourist vehicle in terms of the said Section and Rule. He produces the copy of the RC book and refers to the provisions of Rule 128 to shows that the specifications, dimensions and seating capacity and other structures, door, etc., are not in terms of the specifications laid down in Rule 128 of the Motor Vehicle Rules. He further submits that in terms of the Tribunal ruling rendered in the case of Bayer Diagnostics India Ltd. v. CCE, Vadodara , the demands are not sustainable if the same has not been raised in the show cause notice. The Mumbai Bench has relied on large number of other Tribunal rulings on this point. He relies on Allahabad High Court judgment rendered in the case of Coolade Beverages Ltd. v. CCE, Meerut wherein also it has been held that if the demands have not been specified and raised in the show cause notice, then in such a circumstance, the demands cannot be confirmed. Further reference is also made to the Mumbai Bench ruling rendered in the case of Transpek Inds. Ltd. v. CCE, Vadodara reported in 2006 (1) STR 167 laying down the same ratio in the light of the Apex Court judgment rendered in the case of District Mining Officers v. Tata Iron & Steel Co. ; Laghu Udyog Bharati v. UOI .