No Service Tax applicable to AGM conducted under Convention Centre, No Element of Commerciality: CESTAT [Read Order]

The Customs, Excise, and Service Tax Appellate Tribunal (CESTAT), Chandigarh has held that service tax is not applicable to Annual General Meeting (AGM) conducted under a convention centre, as there is no element of commerciality involved.

The CESTAT upheld the principle of mutuality, which ensures that transactions within an organisation involving its members are not subject to taxation.

The case pertained to M/s. Confederation of Indian Industry (CII), an industry association that organises various types of conventions and workshops.

The Commissioner of Central Excise and Service Tax, Chandigarh had issued an order confirming the demand of service tax on the participation fees collected for conventions, seminars and workshops.

The appellant, represented by Shri Rajesh Kumar, contended that the AGM conducted by them under Convention Centre does not come under the purview of service tax.

The respondent revenue, Commissioner of Central Excise & Service Tax, represented by Ms. Shivani reiterated the findings.

The bench stated that the activities organised by the appellant do not fall under the definition of “Convention Service” as per Section 65(105) read with Section 65(32) of the Finance Act, 1994.

The CESTAT clarified that the convention service is taxable only when it is provided to some person “in relation to holding of a convention”. Since the appellant did not provide any service to any person in relation to holding a convention, no service tax liability could be imposed on them.

Further, the bench pointed out that the conventions organised by the appellant were open to the general public, allowing anyone interested in the subject matter to participate by paying a delegate fee.

As per the definition in the Finance Act, conventions that are open to the general public do not fall within the ambit of “Convention” under service tax law, making them exempt from service tax.

In conclusion, the two-member bench consisting of Mr. S.S. Garg (Judicial Member) and Mr. P. Anjani Kumar (Technical Member) established that no service tax is applicable to AGMs conducted under convention centres, as there is no element of commerciality involved. The doctrine of mutuality applies, ensuring that transactions within an organisation involving its members are not subject to taxation.

To Read the full text of the Order CLICK HERE

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