AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2019 (11) TMI 1451
X X X X Extracts X X X X
X X X X Extracts X X X X
....I 96 - AUTHORITY FOR ADVANCE RULING, MAHARASHTRA. BRIEF FACTS OF THE CASE 1.1. Banda] Namco Entertainment Inc. ('BNEI') is a Japanese video game development company and publisher. BNEI also releases videos, music, and other entertainment products related to its intellectual properties (IP). It has the operation in all major countries around the globe including India. 1.2. The Indian arm is operated by means of a private company set-up under the Companies Act, 1956 bearing the name of Bandai Namco India Private Limited (`BNIPL' or 'the Company' or 'We'). 1.3. The Company provides family entertainment centres built on Japanese standards of safety and peace of mind. The Company offers arcade games and other attractions, mainly based around Pac-Man and Ghostly Adventures themes. 2. We have registered office at T-01, 3rd Floor, Oberoi Mall, Goregaon East, Mumbai 400063 and are engaged in providing amusement facility services and running family entertainment centre in Oberoi Mall, Mumbai since October 2016. 2.1. The Company for its above-mentioned business operations, has stationed various gaming equipment and machines for different age groups, consisting of kids, teenagers and adu....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... amount of GST at 28% was also enclosed with the appeal memo. 2.11. The above entry was amended and bifurcated in two different entries in respect of amusement parks and amusement facilities. These entries were introduced vide Notification No. 01/2018-Central Tax (Rate) dated 25 January 2018 ('Notification 1/2018')] amending Notification No. 11/2017 as mentioned below: Description of Services CGST Rate Condition (iii) Services by way of admission to amusement parks including theme parks, water parks, joy rides, merry-go rounds, go-carting and ballet. 9% - (ilia) Services by way of admission to entertainment events or access to amusement facilities including exhibition of cinematograph films, casinos, race club, any sporting event such as Indian Premier League and the like. 14% - 3. ASPECT ON WHICH THE ADVANCE RULING WAS SOUGHT With the advent of GST Notification 01/2018, which reduced the GST rate on services by way of admission to amusement parks including theme parks, water parks, joy rides, merry-go-rounds, go-carting and ballet, we sought Advance Ruling as to determine the applicable rate of GST on the services/ activities of the Company. 4. FACTS PLACED BEFORE ADV....
X X X X Extracts X X X X
X X X X Extracts X X X X
....musement park promotes social wellness, beget fun and learning, for children and their families, and therefore the rate of GST may be reduced to 18% and ensure that this is passed on to children. Quote In the meeting held on 18th January, 2018, the GST Council has recommended reduction of GST rate on services by way of admission to amusement parks including theme parks, water parks, joy rides, merry-go-rounds, go-carting and ballet from 28% to 18%. These services hitherto attracted GST @ 28%. Requests were received from several quarters that amusement parks promote social wellness and beget fun and learning for children and their families in a real active entertainment and therefore, the rate may be reduced to 18%. ............. It is expected and hoped that States do not raise the tax on entertainment and amusement levied by the local authorities (Panchayats/ Municipalities/ District Councils) so as to increase the tax burden on the amusement parks. This will ensure that the rate cut in GST is passed on to children. 5. It was also submitted that the such amusement activities such as theme park, water park, requires physical participation of the participant whereas in case of ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....T Council has recommended reduction of GST rate on services by way of admission to amusement parks including theme parks, water parks, joy rides, merry-go-rounds, go-carting and ballet from 28% to 18%. These services hitherto attracted GST @ 28%. Requests were received from several quarters that amusement parks promote social wellness and beget fun and learning for children and their families in a real active entertainment and therefore, the rate may be reduced to 18% ............ It is expected and hoped that States do not raise the tax on entertainment and amusement levied by the local authorities (Panchayats/ Municipalities/ District Councils) so as to increase the tax burden on the amusement parks. This will ensure that the rate cut in GST is passed on to children. Unquote The company has relied on the views expressed in the press release dated 22 January 2018 pursuant to the 25th GST Council meeting based on the recommendation of which the Notification 1/ 2018 was issued to reduce GST rate to pass on the benefit of GST to children and promote social wellness and entertainment. 6.2. Neither does the GST law provide the definition of an amusement park nor clarification any ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ferent themes. Unlike temporary and mobile funfairs and carnivals, amusement parks are stationary and built for long-lasting operation. They are more elaborate than city parks and playgrounds, usually providing attractions that cater to a variety of age groups. While amusement parks often contain themed areas, theme parks place a heavier focus with more intricately-designed themes that revolve around a particular subject or group of subjects. 7.2. Authority of Advance Ruling allegation Basis the above definition, the AAR has contended the following: i. Amusement parks offer multitude of rides, games; and ii. Amusement facility offer singular attraction limited to offering entertainment by way of gaming machines 7.3. Company contention Basis the Wikipedia definition of an amusement park referred by the AAR, we have highlighted the key highlights of the definition relevant to operations carried out by BNIPL: i. Various attractions, such as rides and games * BNIPL is engaged in providing amusement activities and running a family entertainment center; * The Company has various gaming equipment and machine such as Kiddie rides, arcade games, redemption games, play area; * ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... by BNIPL cannot be construed as 'park' as such facilities are not spread over a large area of land. 8.3. Company Contention We have referred to the Wikipedia definition of a 'park' below: Quote A park is an area of natural, semi-natural or planted space set aside for human enjoyment and recreation or for the protection of wildlife or natural habitats. Urban parks are green spaces set aside for recreation inside towns and cities. National parks and Country parks are green spaces used for recreation in the countryside. State parks and Provincial parks are administered by sub-national government states and agencies. Parks may consist of grassy areas, rocks, soil and trees, but may also contain buildings and other artifacts such as monuments, fountains or playground structures. Many parks have fields for playing sports such as soccer, baseball and football, and paved areas for games such as basketball. Many parks have trails for walking, biking and other activities. Some parks are built adjacent to bodies of water or watercourses and may comprise a beach or boat dock area. Urban parks often have benches for sitting and may contain picnic tables and barbecue grills The largest ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ark may contain other auxiliary services like food court, independent food area, lodging facilities etc. whereas there is no scope of offering in case of amusement facility. 8.5.3. Company contention The Company has the following contention in relation to the above allegation: i. The AAR in its order has mentioned that that an amusement park may contain auxiliary facilities. The use of the word 'may' express the possibility of the presence of auxiliary facilities in an amusement park. ii. It does not mandate the requirement for auxiliary services for a business activity to qualify as an amusement park. iii. Also, on reading the Wikipedia definition of an 'amusement park' referred by the AAR in its order, it is prudent to note that there is no discussion / indication/ mention/ of any auxiliary services. iv. The definition of amusement park provided by AAR is in contradiction to their allegation. v. It is relevant to note that this definition also does not mandate any necessity to provide auxiliary activities for an amusement park. vi. Further, we would again like to refer of the Bombay Entertainment Act [Section 2 (a-1)] Quote Amusement park means a place wherein v....
X X X X Extracts X X X X
X X X X Extracts X X X X
....tings and the press release, and the ambiguity in the Notification release thereafter should be interpreted in favor of the assessee and that the burden to prove taxability lies on the Revenue ii. Also, as the definition of an amusement park is not mentioned in the GST law, the same should be referred from the subject matter reliable Bombay Entertainment Act. 8.7. No analytical supporting or basis provided for interpretation: The Company is aggrieved by the order passed by the AAR due to following reasons: i. AAR have not analyzed the nature of business by the Company. They have not referred to the submission made by the Company i.e. the list of nature of services provided and the Company brochure. ii. The order passed by AAR is based on non- analytical supporting where the phrases/ words, interpretations and definitions are on limited basis (i.e. relied on the dictionary meaning as per the Wikipedia site, etc.). Further, such interpretations do not form any analytical base but tweaked revenue favoring's. iii. The authority has provided no basis such as appropriate judicial precedents for similar activities/ clarification dismissing the case is provided. 9. The order pas....
X X X X Extracts X X X X
X X X X Extracts X X X X
....joy-rides, merry-go-rounds, go-carting, casinos, race-course, ballet, any sporting event such as Indian Premier League and the like" are chargeable at the prescribed GST rate of28% (CGST 14% and SGST 14%) in term of S. NO. 34 (iii) of the Notification No. 11/2017 - Central Tax (Rate), New Delhi dated 28th June 2017. 13. However, the abovesaid entries of S. No. 34 (iii) of the Notification No. 11/2017 - Central Tax (Rate), New Delhi dated 28th June 2017, were bifurcated vide amendment Notification No 01/2018 - Central Tax (Rate), New Delhi dated 25th January, 2018, whereby services by way of admission to amusement parks including theme parks, water parks, joy rides, merry-go-rounds, go-carting and ballet at S. No. 34 (iii) of Original Notification No. 11/201 7 - Central Tax (Rate), New Delhi dated 28th June 2017, were made chargeable at GST rate of 18% (CGST 9% and SGST 9%). 14. However, the services of admission to amusement facility including the one provided by the Applicant in forms of offering gaming machine, were kept under a new S. No. namely 34(iiia) which still remained chargeable at the rate of 28% (CGST 14% and SGST 14%). 15. There is a fundamental difference between a....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ctionary meaning of park includes, "a large area of land that is used for a specific purpose". However, in case of the subject amusement facilities provided by the Appellant, there is no scope that their gaming facility can be construed as a park, inter-alia because, it is not spread over a large area of land. Therefore, the amusement facility of the Appellant by way of deploying gaming machines can neither be construed as a park nor as an amusement park, so that the benefit of lower rate of GST vide amended S. No. 34(iii) of Notification No. 11/2017 - Central Tax (Rate) may be available to them. 19. The Hon'ble Supreme Court in a recent judgment in case of COMMISSIONER OF CUSTOMS (IMPORT), MUMBAI V /s M/s. DILIP KUMAR AND COMPANY & ORS., Civil Appeal No. 3327 of 2007 = 2018 (7) TMI 1826 - SUPREME COURT at para 52 held that; (1) Exemption notification should be interpreted strictly; the burden of proving applicability would' be on the assessee to show that his case comes within the parameters of the exemption clause or exemption notification. (2) When there is ambiguity in exemption notification which is subject to strict interpretation, the benefit of such ambiguity cannot be....
X X X X Extracts X X X X
X X X X Extracts X X X X
....dictionaries as given below: - * As per dictionaryreference.com A large park equipped with such recreational devices as a merry-go-round, Ferris wheel, roller coaster, etc., and usually having booth for games and refreshments. * As per section 2 (a-1) of the Bombay Entertainment Duty Act "amusement park" means a place wherein various types of amusements including games or rides or both [but excluding exhibition by cinematograph or video exhibition] are provided fairly on permanent basis, on payment for admission. * As per Webster Dictionary a commercially operated park having various devices for entertainment (as a merry-go-round and roller coaster) and usually booths for the sale of food and drink. * As per Wikipedia: An amusement park is a park that features various attractions, such as rides and games, as well as other events for entertainment purposes. A theme park is a type of amusement park that bases its structures and attractions around a central theme, often featuring multiple areas with different themes. Unlike temporary and mobile funfairs and carnivals, amusement parks are stationary and built for long-lasting operation. They are more elaborate than city p....
X X X X Extracts X X X X
X X X X Extracts X X X X
....an be set up only in the large open space. Thus, this fact, further, substantiates that one of the essential characteristics of the amusement parks is its large open space. 26. Thus, it has been established beyond doubt that the gaming zone operated by the Appellant in the closed premises of mall is not the amusement park but the same can more reasonably be envisaged as amusement arcade. 27. Now, for the purpose of examining the entries, we would like to refer to the Notification No. 11/2017-C.T. (Rate) dated 28.06.2017 as amended by the Notification No. 1/2018-C.T. (Rate) dated 25.01.2018, which is being reproduced herein under: Description of Services CGST Rate Condition (iii) Services by way of admission to amusement parks including theme parks, water parks, joy rides, merry-go rounds, go-carting and ballet. 9% - (ilia) Services by way of admission to entertainment events or access to amusement facilities including exhibition of cinematograph films, casinos, race club, any sporting event such as Indian Premier League and the like. 14% - 28. On perusal of the aforementioned rate notification, it is seen that entry (iii) talks about the amusement parks including theme....