Case Law Details
BCD Travels India Private Limited Vs Commissioner of Service Tax (CESTAT Chennai)
Rule 6 (7) ibid., which is extracted in the above paragraphs, clearly gives an option to the taxpayer, specifically an Air Travel Agent, to pay an amount calculated at the rate of 0.6% of the basic fare in the case of domestic bookings and at the rate of 1.2% of the basic fare in the case of international bookings instead of paying Service Tax at the rate specified in Section 66 of the Finance Act, 1994, and as per Section 66, the rate of Service Tax was a flat 12% of the value of taxable services. Section 67 ibid. provides for the assessable value to be the gross amount charged by the service provider for such service.
What is relevant from the above is that the option is given to the taxpayer to remit the Service Tax either in terms of Rule 6 (7) ibid. or Section 67 ibid., and once an option is exercised by the taxpayer, the Revenue cannot find fault with the option so exercised.
Admittedly, the appellant has chosen to pay Service Tax in terms of Rule 6 (7) ibid. and therefore, tax cannot be demanded by applying the provisions of Section 67 ibid. Hence, the ratio in M/s. Japan Airlines International Company Ltd. (supra) is not applicable.
An airline may pay commission inter alia on various items, apart from the basic fare, which are indicated clearly in the ticket issued to a traveller. The basic fare is clearly indicated, followed by various other charges in such ticket. Hence, in our view, when the basic fare is so specifically indicated, the authorities cannot add or delete anything to the same to say that the basic fare should also include those other things.
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