HARJINDER SINGH Vs. COMMISSIONER OF CENTRAL EXCISE, CHANDIGARH

JUDGEMENT

(1.) THE facts leading to these appeals are as under.

(2.) SHRI Jatinder Mohan, Advocate, the learned Counsel for the appellants, pleaded that the services provided by the appellants cannot be treated as rent -a -cab service, that in terms of the appellant's agreements with PRTC, the appellants provided their buses to the Corporation along with the driver, that the appellants bear the expenses for driver, diesel and repair and maintenance of the buses, that the buses are operated by PRTC on various routes, that for providing these services the appellants receive an amount on per day basis which is linked to certain limited kilometres covered during a day and if on a particular day the distance traveled is less than the 50% of the allotted kilometres, no payment would be made to the appellant, that from the terms of the appellant/agreements with PRTC, it is clear that the agreements with the Corporation are not the agreements for renting of the buses, as the appellants have only provided their buses to PRTC and it is PRTC who uses the buses for rendering transport service to individuals under stage carriage permits granted by the concerned Transport Authority, that since in the present case, the appellants only provide their buses without any permit either under Motor Vehicle Act, 1988 or the rules made thereunder (without transferring right of possession and effective control of hired buses), their activity of providing their buses to PRTC does not fall under the category of rent -a -cab scheme operator's service, that the appellants have only provided their vehicles to PRTC and have not provided any transport service to PRTC inasmuch as they are not capable of providing any transport service without a permit, that in view of this, the ratio of judgment of Hon'ble Punjab & Haryana High Court in the case of CCE, Chandigarh v. Kuldeep Singh Gill reported in : 2010 (18) S.T.R. 708 (P & H) would not be applicable, as this judgment is applicable only if the service provider provides transport service to the service recipient, that at the most the appellant's activity of providing their buses to PRTC can be classified under the category of supply of tangible goods service which became taxable w.e.f. 16 -5 -2008 under Section 65(105)(zzzzj) of the Finance Act, 1994, that in this regard, the appellant rely upon the Tribunal's judgment in the case of G. Karunakar Reddy v. CST, Hyderabad reported in : 2010 (20) S.T.R. 352 (Tri. -Bang.) and that in any case even if the appellant's activity is treating as rent -a -cab service, they would be eligible for abatement in terms of Notification No. 1/2006 -S.T. and in addition to this also to the benefit of Notification No. 6/2005 -S.T., that benefit of these exemption notifications has not been considered by the original Adjudicating Authority and First Appellate Authority and if these notifications are taken into account, there would be no Service Tax liability and that in view of the above submissions, the impugned orders are not sustainable.

(3.) WE have considered the submissions from both the sides and perused the records. On going through the facts of this case and also going through the judgment of coordinate Bench of the Tribunal in the case of Deepak Transport Bus Service v. CCE, Pune -III (supra) we find that the facts of this group of cases are identical to the facts of the case of M/s. Deepak Transport Bus Service and issue involved is also identical. Moreover, we also find that the stand of the appellants themselves is that they are not providing transport service to PRTC but have given their buses on hire. In view of this, following the ratio of the Tribunal judgment in the case of Deepak Transport Bus Service v. CCE, Pune -III (supra) we hold that the activity of the appellants would be taxable as rent -a -cab service under Section 65(105)(o) and read with Sections 65(20) and 65(91) of the Finance Act, 1994. However, we find that the Commissioner (Appeals) has not considered the appellant's claim with regard to their eligibility for abatement under Notification No. 1/2006 -S.T. and also for the benefit of exemption under Notification No. 6/2005 -S.T. In view of this, while upholding that the service provided by the appellants is taxable as rent -a -cab service, we remand the matters to Commissioner (Appeals) for considering the appellant's plea with regard to their eligibility for the benefit of Notifications No. 1/2006 -S.T. and 6/2005 -S.T. and re -quantification the duty liability and also re -determination of the quantum of penalty which would be proportionate to Service Tax demands upheld. The appeals stand disposed of as above.