Religious event exemption for pandal services upheld where the celebration was treated as a religious function, not a social gathering.

Pandal or shamiana services supplied for the Gur-ta-Gaddi Tercentenary Celebration were treated as exempt because the event was found to be religious in character. The Tribunal relied on the District Collector's certificate describing the celebration as having great religious significance and followed the earlier High Court view that the circular dated 17.09.2004 continued to apply to religious functions. On that basis, it rejected the contention that the gathering was merely a social function liable to service tax, held the impugned order unsustainable, and set aside the service tax demand.

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Issues: Whether the celebration at Nanded was a religious ceremony so as to attract the benefit of the circular exempting pandal or shamiana services provided for pure religious events from service tax.

Analysis: The dispute turned on the character of the event for which the services were supplied. The Tribunal relied on the certificate issued by the District Collector describing the Gur-ta-Gaddi Tercentenary Celebration as an event of great religious significance, and also noted the earlier High Court ruling holding that the relevant circular dated 17.09.2004 continued to apply to religious functions. On that footing, the Tribunal rejected the view that the event was merely a social function liable to service tax.

Conclusion: The event was held to be religious, the impugned order was unsustainable, and the service tax demand could not stand.

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