Applicability of service tax - facilities or advantages

[CA AMIT DOSHI]

An electric traders association has been registered under club or association category. They have collected money from against advertisement in diaries and credited the proceeds to P & L a/c. The cost of such diaries have been debited separately. Can this proceeds recd from advertisement in diaries be subject to service tax as "facilities or advantages" enjoyed by members in lieu of payment made to association by these members.

AI Summary

Advertisement proceeds treated as advertising consideration, not a facility to members, not taxable as club or association service.
Receipts from sale of advertising space in an association's diary constitute consideration for advertisement services to advertisers, not payment for member benefits, and therefore do not, in the absence of a direct service to members, fall within the scope of club or association service subject to service tax.