Leasing Stalls and Land would not constitute ‘Business Exhibition Services’: CESTAT [Read Order]

The Bangalore bench of the Custom, Excise and Service Tax Appellate Tribunal (CESTAT) has held that leasing stalls and land will not fall under the category of “business exhibition services” under the Finance Act, 1994.

In the instant case, the appellants, M/s. Karnataka Exhibition Authority, Mysore have given rights to others to lease out stalls, during the course of Annual Dusshera Exhibition, Mysore Palace by the way of calling tenders. The department demanded service Tax from the appellant by alleging that the said activity amount to service under Business Exhibition Service.

The appellants contended that they have not provided any exhibition service or for that matter, any service to the exhibitors even in case, it is found that some services provided to the exhibitors. According to them, it was only by the tenderers but not by the appellants. The services of promoting the commercial use or exhibition of any event organized by a person or organization is brought under tax net w.e.f. 01.07.2010, they argued.

Allowing the appeal, the Tribunal recalled it order while deciding the pre-deposit as observed that in the entire proceedings “it is to be noted that the Karnataka Exhibition Authority had leased out the land having stalls, by way of tender”.

“We are of the considered view that leasing stalls and land will not fall under the category of “business exhibition services” as held by the Revisionary Authority. The learned Departmental Representative has relied upon the case of Tamil Nadu Tourism Development Corporation Ltd. cited supra; however, this was only an interim order in respect of the pre-deposit and not a final finding. Going by the facts of the case and by the ratio of the judgments cited by the appellants, we find that the activity undertaken by the appellants is not taxable under “business exhibition services”; at the most, they could have been charged for tax for promoting commercial use or exhibition of any event organized by a person or organization which was taxable only w.e.f. 01.07.2010,”the bench said.