TaxTMI 
TaxTMI 
2019 (11) TMI 1451
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....9/B-37 dated 08.04.2019 = 2019 (7) TMI 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 ....
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....y 2017 was enclosed with the appeal memo. 2.10. Also, a copy of sample invoice generated for this purpose reflecting the 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 ....
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....January 2018 pursuant to the 25th GST Council meeting based on the recommendation on which Notification No. 1/2018 was issued, wherein emphasis was placed on the fact that the amusement 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 p....
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....ing on the applicable GST rate of 18% for beget fun, social wellness and learning for children and their families. The relevant extract of the press release is as under: Quote In the meeting held on 18 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. 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 N....
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....on of Amusement park as per Wikipedia as enumerated below: Quote 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 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....
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..... iii. The amusement activities provided by BNIPL can neither be construed as a park nor as an amusement park. iv. Also, they have mentioned that that an amusement park for amusement, wildlife parks of wild animals and industrial parks for setting up industries. The common thread between all these is a 'large area of land'. v. Therefore, amusement park is generally a big open area containing various amusement facilities which may be covered in a limited/ closed area. vi. Gaming facility provided 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 ....
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....es and refreshments such as games for entertainment purposes that also involve physical exertion and skill. 8.4. Analysis Accordingly, amusement activities provided by BNIPL in a mall i.e. a building structure should be considered an amusement park basis the above-mentioned Wikipedia definition of an amusement park and a park. 8.5. Other auxiliary facilities 8.5.1. The Authority has relied on the auxiliary facilities provided by an amusement park to differentiate it in relation to services provided by an amusement facility. 8.5.2. Authority allegation The Authority is of the view that amusement park 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 fo....
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....is not specifically defined in Statutory Act then in such a case the same can be referred in the General Clause Act. iii. However, if there is any repugnancy or conflict as to the subject or context between General Clauses Act and a statutory provision which falls for interpretation, Revenue shall refer to the provisions of statute. iv. In light of above, as the definition of an amusement park is not available in the Statutory Act and General Clauses Act, the company have relied on the Bombay Entertainment Act. 8.6.4. Analysis The following key points are relevant for the Company from the above-mentioned judicial precedent: i. The intention of the Government for reduction in rate of GST expressed vide the Council meetings 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:....
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....per Rule 6 of ST Rules at the rate of 14% and 0.5% Krishi Kalyan Cess. The Appellant is providing services of amusement facilities by deploying Gaming machines in one of the leading Mall in Mumbai. It is seen from GSTR 3B filed by the assessee during the month of June 2018, the Taxable value is Rs. 59,85,953/- and assessee has paid CGST Rs. 8,38,033/- and SGST Rs. 8,38,033 /- (Rate 28%). 12. The assessee had filed the Advance Ruling Authority Application regarding applicability of earlier Notification No. 11/2017 -Central Tax (Rate) dated 28.06.2017 amended vide Notification No. 01/2018- Central Tax (Rate), dated 25.01.2018 issued by Government of India, Ministry of Finance, Department of Revenue, New Delhi. "The Service by way of admission to entertainment events or access to amusement facilities including exhibition of Cinematograph films, theme parks, water parks, 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 J....
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....imes may be over hundred to thousand acres, the amusement facility, offering gaming machine is spread over a limited/ closed area of a mall that may be in the range of some thousand square feet. (c) Whereas amusement park may contain other auxiliary facilities like food courts, independent food areas, lodging facilities etc., there is no scope of offering any such auxiliary facilities, in case of subject amusement facilities of the Appellant by way of offering gaming machines, (d) An amusement park is generally a big open area, containing various amusement facilities which themselves may be under a covered premise, however the subject amusement facility of the assessee by deploying gaming machine is relatively a very-small covered/ closed premises. (e) In view of the above, the subject amusement facility of the Appellant by deploying gaming machine cannot qualify as an amusement park. 18. The Far lax Dictionary 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-....
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....it is found that the terms "amusement park" and "amusement facility" have not been defined therein. Hence, we are compelled to resort to other relevant statutes and sources such as the various Dictionaries, so as to comprehend the meaning of aforesaid terms. 23. The term "amusement facilities" had been defined in section 65(B)(9) of the erstwhile Finance Act, 1994 as under: '(9) "amusement facility" means a facility where fun or recreation is provided by means of rides, gaming devices or bowling alleys in amusement parks, amusement arcades, water parks, theme parks or such other places but does not include a place within such facility where other services are provided;' Now, in order to understand the above definition of the term "amusement facility", we seek to refer to the meaning of terms "amusement park" and "amusement arcade", which have been used in the aforesaid definition. Amusement Park: The term amusement park has been defined under various 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 usual....
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....d as amusement arcade, and not the amusement park as propounded by the Appellant, because all the amusement rides and games are located in the covered premises or area inside the mall as envisaged under amusement arcade. It was also categorically submitted by the Appellant that they offer arcade games and other attractions, mainly based around Pac-Man and Ghostly Adventure themes, which are also arcade games only. On the contrary, the amusement park mainly talks about the rides like merry-go-round, Ferris wheels, roller coaster, etc. which can only be installed and operated in the large open field, and not in the closed premises as in the case of the Appellant. Further, it is also gathered invariably from various sources, viz- Webster Dictionary, dictionaryreference.com, Wikipedia, etc., that theme parks as well as water parks are considered as types of amusement park only with their own specific characteristic features and attraction. Again, the theme parks and water parks cannot be set up in the closed premises such as the one where the Appellant has set up its gaming zone. These can be set up only in the large open space. Thus, this fact, further, substantiates that one of the e....