2020 (3) TMI 1003

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....ociation" as defined in Section 65 (25a) of the Finance Act, 1994. It has also been alleged that the petitioner, being an incorporated company, the services rendered by it cannot be said to be excluded from the definition of "club or association" in view of specific exclusion subclause (iii) to the above definition. Hence, the impugned Show Cause Notice came to be issued calling upon the petitioner to pay a sum of Rs. 3,08,58,591/- as service tax, Rs. 6,00,659/- as primary education cess and Rs. 2,24,896/- as secondary higher education cess, for the period from 2005 and May 2010, recoverable under Section 73-A (1) of the Finance Act, 1994, along with interest under Section 75 of the said Act and penalty under Sections 76, 77 and 78 of the s....

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.... 72, 73, 82, 83 and 84, the Honourable Supreme Court has observed as under:- " 71. With this background, it is important now to examine the Finance Act as it obtained, firstly from 16th June, 2005 uptil 1st July, 2012. 72. The definition of "club or association" contained in Section 65(25a) makes it plain that any person or body of persons providing services for a subscription or any other amount to its members would be within the tax net. However, what is of importance is that anybody "established or constituted" by or under any law for the time being in force, is not included. Shri Dhruv Agarwal laid great emphasis on the judgments in DALCO Engineering Private Limited v. Satish Prabhakar Padhye and Ors. Etc. (2010) 4 SCC....

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.... was not, therefore, right in restricting the word "constitute" to mean only "to create", when clearly it could also mean putting a thing in a legal shape. The Bombay High Court, therefore, in the case of Dwarkadas Khetan and Co. v. CIT [(1956) 29 ITR 903, 907] , was right in holding that the section could not be restricted in its application only to a firm which had been created by an instrument of partnership, and that it could reasonably and in conformity with commercial practice, be held to apply to a firm which may have come into existence earlier by an oral agreement, but the terms and conditions of the partnership have subsequently been reduced to the form of a document. If we construe the word "constitute" in the larger sense, as in....