2026-VIL-1836-CESTAT-CHE-ST
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SERVICE TAX CESTAT Cases

Service Tax - Inclusion of value of air tickets sold by tour operator in taxable value of Tour Operator Service - Appellant, registered as a tour operator, booked and sold air tickets to its clients under invoices showing the amount as sale of air tickets, and the Department held that booking air tickets was a taxable service and that the amount collected was includible in the taxable value, as the value adopted by Appellant for payment of service tax varied from the invoice value - The demand was confirmed with interest and penalty under Section 76 of the Finance Act, 1994, and upheld by FAA - Appellant contended that the dispute pertained only to trading in air tickets bought from travel agents and sold to customers with or without profit, and that the issue was settled in its favour by the Tribunal in its own earlier cases - Whether Appellant is liable to include the value of air tickets in the taxable value of the services rendered by it - HELD - The issue stands decided in favour of Appellant by several Final Orders of this Tribunal in its own case, which held that where the activity is mere trading in air tickets bought from travel agents and sold to customers, with other activities admittedly taxed and paid, there being no allegation that Appellant was a member or agent of the air transport association or earned commission from airlines, and nothing in the definition of tour operator service suggesting that trading in air tickets per se attracts service tax, the demand on consideration for booking of tickets is not a taxable event. Revenue has not shown that the earlier Final Order has not attained finality, and where the dispute regarding the nature of the transaction and its exigibility to service tax between the same parties has attained finality, and there is no allegation or evidence that the present transactions are of a different nature, that is another compelling reason to decide in favour of Appellant - Following the coordinate Bench Final Orders, the impugned order is set aside and the appeal is allowed
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