Consider the following scenario:
Say X is the permit holder and he owns a bus.
He gives his vehicle to Y for operating the same.
Y in turn lends it to people who need the vehicle for operating tours.
Y collects the dues depending on the number of trips/distance covered on special permit routes and out of that, he pays:
1) A fixed amount of Rs.1000/- (hypothetically) per day to the owner towards special route permit.
2) Meets operating expenses such as duties and taxes, drivers' payments etc.
Also, I found the following notification:
Notification No.12/2012 Service Tax dated 17.03.2012
[F. No.334/1/2012-TRU]
According to clause 23(b): Service Tax is applicable for carriage operating for tourism, conduct tours, charter or hire.
My question is whether this Rs 1,000/- received by the permit holder from the end user through the intermediary is liable to Service Tax. The owner is also doing other services that exceeds the threshold limit. Does this notification apply here?
