Tribunal rules in favor of cricketers, prize money non-taxable

The Tribunal ruled in favor of the assessees, determining that the employer-employee relationship between cricket players and franchisees precluded the classification of their services under Business Support Services (BSS) or Brand Promotion Services (BPS). As a result, the appeals of the assessees were allowed, and the Revenue's appeals were dismissed. The prize money received from BCCI was deemed non-taxable, and the cause title was amended to reflect the change in jurisdiction.

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Issues Involved:
1. Classification of services provided by cricket players under Business Support Services (BSS) and Brand Promotion Services (BPS).
2. Employer-employee relationship between players and franchisees.
3. Taxability of prize money received from BCCI.
4. Amendment of cause title due to change in jurisdiction.

Detailed Analysis:

Issue 1: Classification of Services under BSS and BPS
The primary issue in these appeals is the classification of services provided by cricket players. The Revenue classified services provided up to 30.06.2010 under Business Support Services (BSS) and services provided from 01.07.2010 to 31.03.2011 under Brand Promotion Services (BPS) under Section 65(105)(zzzzq) of the Finance Act, 1994. The adjudicating authorities confirmed the entire demand under BSS for the first period and BPS for the second period. However, the Commissioner (Appeals) set aside the service tax demand prior to 01.07.2010 under BSS and partially upheld the demand from 01.07.2010 onwards under BPS, denying value-based exemption under Notification No. 6/2005-ST.

Issue 2: Employer-Employee Relationship
The assessees argued that they were employed as professional cricketers by the franchisees and not providing any service that could be classified under BSS or BPS. The Tribunal, after reviewing the tripartite agreement between BCCI, franchisees, and players, found that the players were indeed recognized as employees of the franchisees. This employer-employee relationship was further supported by the decision in Sourav Ganguly Vs. UOI – 2016 (43) STR 482 (Cal.) and other similar cases. The Tribunal concluded that this relationship precludes the classification of the players' activities as taxable services under BSS or BPS.

Issue 3: Taxability of Prize Money
The assessees contended that the prize money received from BCCI should not be included in the taxable value as it was not paid by the franchisees and was unrelated to any services rendered. The Tribunal agreed, stating that the prize money was directly received from BCCI for winning and not for any services provided to the franchisees. Hence, it should not be included in the taxable value. However, since the Tribunal held that no taxable service was provided, this issue became academic.

Issue 4: Amendment of Cause Title
The Tribunal acknowledged the need to amend the cause title in the miscellaneous applications filed by the Revenue to reflect the change in jurisdiction from CCE & ST, Chennai to the Commissioner of GST & CE, Chennai South Commissionerate. The applications for change of cause title were allowed accordingly.

Conclusion:
The Tribunal concluded that the employer-employee relationship between the players and franchisees negates the classification of services under BSS or BPS. Consequently, the assessees' appeals were allowed, and the Revenue's appeals were dismissed. The prize money received from BCCI was not to be included in the taxable value, and the cause title was amended to reflect the change in jurisdiction.

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