TaxTMI 
TaxTMI 
2014 (2) TMI 524
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....re that the appellants were founded in 1995 to encourage and promote craft, micro, small and medium enterprises and protect their interest. An information was gathered and developed by the Anti-Evasion Branch of Service Tax Commissionerate, New Delhi that the appellants were engaged in providing 'Club or Association Services', which were brought into the Service Tax net w.e.f. 16-6-2005 vide Section 65(25a) of the Act, ibid but were not discharging their Service Tax liability. The appellants were issued a Show Cause Notice C. No. DL/ST/AE/Inq./08, dated 20-7-2010 proposing thereunder recovery of Service Tax amounting to Rs. 21,68,454/- by invoking extended period of limitation under Section 73(1) of the Act, ibid. Interest and penal provisions were also invoked. The adjudicating authority, vide impugned order, confirmed the demand of Service Tax demanded with interest and imposed penalties, cited supra. 3. Feeling aggrieved with the order of the adjudicating authority, the appellants have filed the present appeal on the following grounds : 3.1 That they are primarily engaged in carrying out rural development programmes, to encourage and promote entrepreneurship to o....
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....et-together; or (iii) amount paid for functions charged over and above the subscription amount. The appellants do not provide any services, facilities or advantages to its members for which they charge subscription or any other amount. The services provided by them do not fall under the category of taxable services under the category of club or association services. More than a dozen similar bodies like FIEO, ASOCHAM, CII, FICCI, PHD Chamber of Commerce and Industry etc. represent their members to present their view point before Government of India and other bodies, which in turn help Government in formulating their policies. None of these bodies are covered under Service Tax under the said entry. It is further submitted that they are recognized by the Parliament, Union Ministries and UN Agencies where they are invited for consultation on behalf of Trade & Industry. 3.3 That the amount received by them is not chargeable for the following reasons :- (i) Membership Fees - The services provided by any club or association to its members for consideration in money form is covered under the heading club or association. The appellants represent all the M....
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....e of Dehradun Club Limited v. CCE - 2007 (7) S.T.R. 519 (Tri.-Del.) observed that in case of a club in which every member is shareholder and club opens to members only, the recipient of service from the club not clients and Service Tax not attracted. CESTAT relied upon various judicial pronouncements in this regard. (ii) That the appellants are authorized by Director General of Foreign Trade, Ministry of Commerce, Government of India to issue certificates of Origin - Non-preferential vide Entry No. 3 in list for Delhi under Appendix 4C of Handbook of Procedures Vol. I. The appellants issue country of origin certificate to any exporter, whom so ever from Delhi approaches them for such certificate. A small amount is collected from them to meet the office expenses. Such certificates after necessary verifications are issued by them to everyone irrespective whether he is member of their organization or not. In the last five years, the appellants have issued such certificates to thousands of the exporters as against 330 members. This is a trade facilitation service provided by them to exporters from Delhi, which cannot be termed as services provided by them to their members whic....
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.... 2002 (146) E.L.T. 481 (S.C.) and CCE v. Chemphar Drugs & Liniments - 1989 (40) E.L.T. 276 (S.C.). In view of the above, it is submitted that extended period is not invokable in this case. 3.5 For the demand of interest on the Service Tax confirmed in the impugned order, it is submitted that the interest is payable when a person is liable to pay Service Tax and in turn fails to discharge the same. In this case, the Service Tax demand is liable to be set aside and hence the recovery of interest is also liable to be set aside. 3.6 That a penalty of Rs. 1,000/- has been imposed under Section 77 of the Act. It is submitted that penalty under this section is imposable only when a person is liable to pay Service Tax and to follow laid down procedure for registration, filing of returns, payment of Service Tax etc. In this case, the Service Tax liability does not arise and hence they are not required to follow the laid down procedure for registration, filing of returns etc. and hence no penalty under Section 77 of the Act is imposable. 3.7 For the imposition of penalty of Rs. 21,68,454/- under Section 78 of the Act, in view of the detailed submissions made above, th....
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....r expenses, small amount is collected from the members; that the contribution is made by 330 members but the work is done for the cause of more than a lakh enterprises and hence the activity cannot be termed as service provided to 330 members, who contribute small sums to meet the expenses; that any issue taken up by them with the authorities or any other trade facilitation measure for industry at large cannot be called a service to its members; that these are not the services, facilities or advantages provided by them to the members for a subscription or any other amount hence not covered under Section 65(105)(zzze) of the Act. For the income of Rs. 20,000/-, the appellants have contended that a small amount of Rs. 20,000/- was collected from members for coordinating participation of members in the US fair and this amount was not collected for providing any service and hence the demand for coordinating participation in the US fair is not tenable and is liable to be set aside. I find that the Club or Association Services are classified under Section 65(25aa) of the Finance Act, 1995 as under : (25aa) "club or association" means any person or body of persons providing servic....
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.... 'primarily to members' does not restrict any service provider to render services to any non-member or any other person, who is not their member directly but the benefits of the services rendered reach such other person indirectly, as is in the present case. Provision of service to non-members has also been admittedly stated by the appellants in their grounds of appeal. For the amount of Rs. 20,000/- collected by the appellants for coordinating participation for the members in US fair, I find that the activity is clearly covered under the definition of Club or Association Services as their members were bound to benefit from the services provided by the appellants for which the requisite amount was charged by them. I further note that the activities of the appellants are not covered under the exclusion clauses of the said definition of Club or Association Services as the appellants are neither providing any services in the activities of trade unions, promotion of agriculture, horticulture or animal husbandry, or any person or body of persons engaged in any activity having objectives which are in the nature of public service and are of a charitable, religious or political nature; or ....
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....e period, learned Advocate submits that the Service Tax was not liable to be taxed in view of the above retrospective exemption to the same. 4. After hearing learned SDR, we find that admittedly newly introduced provisions of Section 96J were not before the Commissioner at the time of passing of the impugned order, the same are required to be considered by him for which purpose the matter is being remanded to him. The above findings of the Hon'ble CESTAT and the stipulation made under Section 96J of the Finance Act, 1994, I hold that the issue warrants no further discussion and it is settled in favour of the revenue that during the period 1-4-2009 to 6-7-2010, the appellants were liable to pay Service Tax on the subscription amount collected by them from their members for providing various activities covered under Club or Association Services. Since the appellants have not paid the Service Tax during the relevant period on the subscription received being Membership Fee, I uphold the recovery thereof, as held by the adjudicating authority, with interest and also the appellants are liable to penalty. However, since the break-up of the income received by the appellants agai....
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....al practice followed is that the exporter makes an application to the Chamber or any authorised agency for issuance of COOC, in the prescribed form, along with a copy of commercial invoice and other documents and pays the prescribed fees. On the basis and verification of the information provided in the application for COOC and the supporting documents with reference to the goods sought to be exported, the Chamber or the authorised agency issues a COOC. 3. The above activity carried out by the Chambers, involving certification of the national character of the export goods, squarely falls under 'technical inspection or certification', as defined in Section 65(108) of Finance Act, 1994. In certain cases, when COOC is issued with reference to national character of the goods upon examination of the origin of their composition, requirements of the definition provided in Section 65(108) of Finance Act, 1994 is clearly fulfilled. A chamber or EPC or Trade Association which issues COOC acts as a technical inspection and certification agency, and issuance of COOC attracts Service Tax under 'technical inspection and certification agency' service, which is a specific description when c....
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....ations Organization and exempted from the levy of Service Tax. A careful study of the Notification No. 16/2002-S.T., dated 2-8-2002 shows that an Explanation to the above Notification has been attached which reads as under : Explanation. - For the purposes of this notification, "International Organization" means an international organization declared by the Central Government in pursuance of Section 3 of the United Nations (Privileges and Immunities) Act, 1947 (46 of 1947), to which the provisions of the Schedule to the said Act apply. I have gone through Section 3 of the United Nations (Privileges and Immunities) Act, 1947 (46 of 1947) and observed that UNCTAD has not been covered in the list of international organizations to whom certain privileges and immunities have been granted under the said Act. As such I find that M/s. FISME are not entitled to exemption in terms of Notification No. 16/2002-S.T., dated 2-8-2002. I note that the appellants have not put forth anything in their grounds of appeal for the observations of the adjudicating authority. On perusal of the stipulation made under Section 3 of the United Nations (Privileges and Immunities) Act, 1947, I agree wit....