TaxTMI 
TaxTMI 
2012 (6) TMI 636
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....(67) of the Finance Act, 1994 when the services are utilized by the members of the club. However, it has also been held that the service provided by the petitioner-club to anyone other than the members, is liable for service tax. This order dated 13.08.2007 was challenged before the Hon'ble Supreme Court as well as by filing the review petition before this Court. During the pendency of Special Leave to Appeal (Civil) CC 4926 of 2008 before the Hon'ble Supreme Court, the Review Petition No. 51 of 2008, preferred by the Revenue, was allowed by the Division Bench of this Court (in which one of us Justice Prakash Tatia was member) vide order dated 21.04.2011 and the order dated 13.08.2007 was set aside. In view of setting aside of the order dated 13.08.2007 by this Court itself, the Hon'ble Supreme Court disposed of the Revenue's Special Leave to Appeal (Civil) CC 4926 of 2008, as nothing remained before the Supreme Court to be decided after setting aside of the order referred above. Now the matter has come up before this Court for hearing again the same issue. 3. As we have noticed that petitioner's contention is that petitioner is a club and also registered company under the Compani....
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....come tax cannot be imposed on the transaction of the club with its members. 4. With the help of these two judgements, learned counsel for the writ petitioner submitted that the petitioner is a club and is rendering services to its members and the same principle of mutuality applies to the facts of the case in view of the reason that the language in the provisions of the Madras General Sales Tax Act, 1959 and the provisions under the Income Tax Act are para materia with the provisions which are sought to be applied against writ petitioner for levy of service tax. 5. Learned counsel for the respondents submitted that sale has its own meaning and service is entirely different transaction which cannot be equated with the sale in any manner. Learned counsel for the Revenue also relied upon the book "Principles of Statutory Interpretation" by Hon'ble G.P.Singh, the then Chief Justice, M.P. High Court (3rd Edition), wherein there is reference of a case wherein Hon'ble Bhagwati J. observed that, for construction of fiscal statute and determination of liability of the subject to tax, one must have referred to the strict letters of law. Learned counsel submitted that the statutory provisio....
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....our purpose is Section 65(105)(zzze) which is as under :- Section 65(105) (zzze). "to its members, by any club or association in relation to provision of services, facilities or advantages for a subscription or any other amount; 10. The explanation appended to Section 65 is as under :- "For the purposes of this section, taxable service includes any taxable service provided or to be provided by any unincorporated association or body or persons to a member thereof, for cash, deferred payment or any other valuable consideration". 11. As per Section 66 of the Finance Act, 1994, service tax is leviable at the rate specified in Section 66 itself and at the relevant time it was 12% of the value of the taxable service. Therefore, the service tax is leviable on the consideration charged for the services. 12. Since it is a plea of the writ petitioner, that the provisions of Madras General Sales Tax Act, 1959, particularly Section 2(g) and 2(n) as also the definition clauses of the said Act of 1959 which have been interpreted by the Hon'ble Supreme Court and the Hon'ble Supreme Court also has considered the explanation-I appended to Section 2(g), therefore, they are required to be consid....
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...., however, liquor is supplied to and paid for by a person who is not a bona fide member of the club or his duly authorised agent, there would be a sale. With regard to incorporated clubs a distinction has been drawn. Where such a club has all the characteristics of a members' club consistent with its incorporation, that is to say, where every member is a shareholder and every shareholder is a member, no licence need to be taken out if liquor is supplied only to the members. If some of the shareholders are not members or some of the members are not shareholders, that would be the case of a proprietary club and would involve sale. Proprietary clubs stand on a different footing. The members are not owners of or interested in the property of the club and then the Hon'ble Supreme Court observed that above view was accepted by the various High Courts in India. The Hon'ble Supreme Court, relying upon other judgements held that members' club is only structurally a company and it did not carry on trade or business so as to attract the corporation profit tax. Therefore, in spite of specific inclusion of the club in the definition of the dealer in the Madras General Sales Tax Act, 1959 by pro....