In re Crown Tours & Travelers (GST AAR Rajasthan)
Whether the rate of 5% under heading 9985(i) is applicable on transaction which the Applicant intents to undertake wherein a single invoice is raised in respect of all the services i.e. local transportation services along-with services like sightseeing, tour guide, elephant ride etc., provided by the Applicant to The Main Tour Operator?
Notification No. 11/2017-Central Tax (rate) dated 28.06.2017 defines Tour Operator as “any person engaged in the business of planning, scheduling, organizing, arranging tours (which may include arrangements for accommodation, sightseeing or other similar services) by any mode of transport, and includes any person engaged in the business of operating tours.”.
Further, the above said Notification also delineates two conditions for a tour operator;
1. Provided that credit of input tax charged on goods and services used in supplying the service /, other than the input tax credit of input service in the same line of business (i.e. tour operator service procured from another tour operator)]48 has not been taken [Please refer to Explanation no.(IV)].
2. The bill issued for supply of this service indicates that it is inclusive of charges of accommodation and transportation required for such a tour and the amount charged in the bill is the gross amount charged for such a tour including the charges of accommodation and transportation required for such a tour.
We find that, the first condition is related to restriction of input tax credit whereas second condition is related to criteria for inclusion of charges of accommodation and transportation in the bill of a tour operator.
The second condition clearly emphasise that a bill issued by a tour operator for supply of its services should be inclusive of charges of accommodation and transportation required for such a tour. The conjunction ‘and’ clearly explains that accommodation and transportation, both are must elements for a tour whereas conjunction ‘or’ may have rendered option between accommodation and transportation. Whereas, the applicant is rendering only transportation with some ancillary services and not accommodation, as such does not satisfy the conditions as mentioned under Serial No. 23 (i) {Chapter heading 9985} of Notification No. 11/2017-Central Tax (rate) dated 28.06.2017(as amended), therefore, rate of GST 5% is not applicable.
In view of the foregoing, we rule as that The services provided by the applicant do not fall under the purview of Serial No. 23(i) {Chapter heading 9985} of Notification No. 11/2017-Central Tax (rate) dated 28.06.2017 (as amended) and rate of GST 5% is not applicable.
FULL TEXT OF ORDER OF AUTHORITY OF ADVANCE RULING, RAJASTHAN
Note: Under Section 100 of the CGST/RGST Act, 2017, an appeal against this ruling lies before the Appellate Authority for Advance Ruling constituted under section 99 of CGST/RGST Act, 2017, within a period of 30 days from the date of service of this order.
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