In a recent legal ruling, the Supreme Court upheld a decision made by the Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ) regarding the liability of the Patanjali Yogpeeth Trust to pay service tax. The trust was found liable for charging an entry fee for organizing various Yoga camps, whether they were residential or non-residential in nature.
The bench, consisting of Justices Abhay S Oka and Ujjal Bhuyan, dismissed the appeal brought by the Trust and affirmed the tribunal’s ruling.
The tribunal had classified Yoga camps with participation fees as a type of service, a decision that the court agreed with, leading to the dismissal of the Trust’s appeal.
This confirmed the classification of Yoga camps as a taxable “health and fitness service,” making them subject to service tax.
The Trust, which operates under the guidance of Yoga guru Ramdev and Acharya Balkrishna, conducts Yoga training at different camps. The tribunal’s order highlighted that the fees collected from participants, characterized as donations, were seen as consideration for the services rendered, thus falling under the service tax ambit.
Despite the Trust’s argument that its primary focus is on providing services for curing ailments and therefore should not be taxed as a “health and fitness service,” the tribunal had remained unconvinced. It categorized the Trust’s offerings under the taxable services provided by health clubs and fitness centers.
Furthermore, the tribunal pointed out that the Trust’s collection of entry fees, disguised as donations and issuing tickets with varying benefits, constituted a taxable activity. It noted that the Yoga and Meditation instructions at these camps were generic and not tailored to individual participants, and no specific prescriptions or treatments for ailments were provided.
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