Supply of Furniture for Functions is a Taxable Service: CESTAT [Read Order]

The Delhi bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has held that the supply of furniture for functions are taxable service for the purpose of imposing Service Tax under the Finance Act, 1994.

The appellant, Shree Balaji Tent House was engaged in providing the taxable services falling under the category of Pandal or Shamiana Contractor Services as defined under Section 65 (77b) of the Finance Act, 1994.

The department held that the appellant was liable to pay Service Tax for the period November, 2004 to January, 2007 as the provision of articles such as fixture, light etc, in connection with preparation, arrangement of a Pandal or Shamiana will be liable for payment of Service Tax under the above category.

It was contented by the appellant that they are not liable to pay Service Tax since they have supplied only furniture, fixtures, lights, light fittings floor covering etc. The Service Tax cannot be levied unless they have been supplied along with tent/ Shamiana.

Upholding the orders of the lower authorities, the bench held that the supply of furniture by the petitioner for Rajasthan Diwas and like functions clearly falls within the ambit of the taxable service.

“In view of Section 65 (77a), ‘Pandal’ or ‘Shamiana’ is defined to mean a place specifically prepared or arranged for organizing an official, social or business functions; and under Section 65(77b) ‘Pandal or Shamiana Contractor’ means a person engaged in providing any service, either directly or indirectly, in connection with the preparation, arrangement, erection or decoration of a Pandal or Shamiana and includes the supply of furniture, fixtures, lights and light fittings, floor coverings and other articles for use therein. Section (105) (zzw) enumerates any service provided or to be provided to any person by a Pandal or Shamiana Contractor in relation to a Pandal or Shamiana, in any manner and including the services, if any, provided or to be provided as a caterer, to be the taxable service,” the bench said.