NOTIFICATION No. 40/97-ST, dated 22-8-1997
In exercise of the powers conferred by section 93 of the Finance Act, 1994 (32 of 1994), the Central Government, being satisfied that it is necessary in the public interest so to do, hereby exempts taxable service provided by a tour operator from so much of the service tax leviable on such operator, as is in excess of the amount of service tax calculated on ten per cent. Of the gross amount charged from any person by such operator for the services provided in relation to a tour , if the tour is providing services solely of arranging or booking accommodation for any person in relation to a tour and the bill issued for this purpose indicates that it is towards charges for such accommodation:
Provided that the said exemption shall not apply in such cases where–
(a) the invoice, bill or challan issued by the tour operator to the client only includes the service charges for arranging or booking accommodation for any person in relation to a tour and does not include the cost of such accommodation; or
(b) credit of duty paid on inputs or capital goods has been taken under the provisions of the Cenvat Credit Rules, 2004; or
(c) such tour operator has availed the benefit under the notification of the Government of India in the Ministry of Finance (Department of Revenue), No. 12/2003-Service Tax, dated the 20th June, 2003 [G.S.R. 503 (E), dated the 20th June, 2003].