TaxTMI 
TaxTMI 
2013 (8) TMI 529
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....hey have collected the amounts over and above membership fees towards room rental, usage of telephone, fax etc. interest on instalment payments, income from securitization, exchange fee which should be included in the taxable service as gross amount received for rendering the services. The Commissioner confirmed the demand of service tax of Rs.22,24,69,008/- along with interest and penalties. 2. The Learned Advocate on behalf of the applicant contested the demand of tax on merit as well on limitation. 2.1 Regarding demand of tax about Rs.8.14 crores on Room Rentals, the ld. Advocate submits that these amounts were collected only from the non-members which is not taxable under "Club or Association Service". He submits that they had pro....
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....licant company. 2.4. As regards demand of tax of about Rs.3 lakhs on Exchange fee, he submits that it was collected from member in lieu of exchange of their eligible holidays / tours to stay in non-listed resorts. It is contended that exchange fees is not related with the membership service offered by them and cannot attract service tax under "Club or Association Service". 2.5 As regards demand of tax of about Rs.6.65 lakhs on Telephone and Fax charges, he submits that the said amount was not included in the membership fees and separately collected based on usage. He further submits that telephone and fax are covered under the telecommunication services and cannot be claimed under the head of "Club or Association service" or for using....
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....ma facie, we find force in the submission of the Ld. AR that interest on instalment sales is merely interest on delayed payment of membership fees and same cannot be equated with "interest on loan" as referred in Section 67 of Finance Act, 1994, Service Tax (Determination of Value) Rules, 2006 and Board circular. The interest is payable on various counts, such as money or property has been deposited as security for the performance, obligation to pay money, any debt or damage etc. In the present case, obligation to pay membership fees alongwith service tax would be at the time of entry. Club is charging interest on delayed payment of membership fees. Similarly, Revenue is also deprived of tax on delayed payment of membership fees, which was ....
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....ncelled members). The Ld. Advocate submits that in the case of cancellation of membership, the amount deposited would be adjusted and no further receivables. The Ld. A.R. submits that the words "any other amount" in Section 65(105) would cover these amounts collected in relation to the amounts received from the members. In our view, the scope of the words "any other amount' in the Section is wide. But, it must have a direct or a proximate relation to the taxable service. Prima facie, it appears, income from securitization is an independent transaction between the bank and the applicant company. 4.2 The next issue is room rental. The applicant claimed that room rentals were collected from non-members only. The Commissioner observed that t....