No evidence to prove collection of charges for providing Club or Association Services to members: CESTAT quashes service tax demand on Punjab Cricket Association [Read Order]

The Chandigarh bench of the Customs, Excise, and Service Tax Appellate Tribunal allowed the appeal by the Punjab Cricket Association (PCA) for exemption of service tax for the Club or Association like services rendered by them to its members as the Commissioner of Central Excise (CCE) (the respondent) could not provide sufficient evidence to support their arguments.

The Punjab Cricket Association was registered as a service tax assessee for providing “Club or Association Services” as they have been receiving payments like registration fees, entrance fees, etc., and charges for providing additional services like billiards, swimming pool, lawn tennis from its members and have not paid the service tax for providing these services.

The CCE confirmed the impugned order and demanded service tax of Rs.15,65,652/- along with interest of Rs.4,31,344/- as per the penalty under Section 76 and Section 78 of the Finance Act, 1998. The first appeal was dismissed by the Commissioner (Appeals) who passed the impugned order confirming the duty of Rs.8,09,168/- along with the penalty under Sections 76 and 78.

Sudeep Singh Bhangoo appeared on behalf of the PCA and submitted that the PCA was associated with BCCI and had enrolled only eight categories of people as its members and only associate members are charged a fee for enrolling as members; therefore, the PCA cannot be considered as a Club or Association as per Section 65(25a) of the Finance Act,1994 therefore no service tax can be levied from them as per the case of Calcutta Club Limited-2019(29) GSTL 545 (SC).

He further submitted that out of the total confirmed by the Commissioner(appeals), Rs.4,31,334/- was already paid before the issue of the show-cause notice and therefore the benefit of section 80 is admissible.

The council appearing on behalf of the revenue reiterated the findings of the impugned order.

The two-member bench consisting of S.S. Garg (Judicial Member) and P. Anjani Kumar, after hearing both sides held that the Revenue had not adduced any evidence to demonstrate that the PCA had collected the charges for providing services to its members and in the view of the fact that the PCA was registered under the Society Registration Act, the PCA are not liable to pay service tax under the heading “Club or Association Service”.

Therefore, the impugned order was set aside and the appeal was allowed.

To Read the full text of the Order CLICK HERE

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