No Service Tax on Service by Indian Tour Operators in foreign currency to foreign tourists

Introduction:

1. The writ petition by the Indian Association of Tour Operators, seeks a declaration that Rule 6A of the Service Tax Rules, 1994 (‘ST Rules’), concerning ‘Export of services‘ is ultra vires the Finance Act1994 (‘FA’). The validity of Section 94 2 (f) of the FA is also challenged on the ground that it gives unguided and uncontrolled power to the central government to frame rules regarding ‘provisions for determining export of taxable services’.

2. The members of the Petitioner, who are Indian tour operators, are engaged in the business of arranging tours containing bouquet of services for foreign tourists visiting India as well as her neighbouring countries and consideration is generally received in convertible foreign exchange.

Background – prior to 1^st July 2012.

1. Tour Operator services is a taxable service.

Please become a Premium member. If you are already a Premium member, login here to access the full content.