TaxTMI 
TaxTMI 
2025 (2) TMI 1216
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..... 3. On the basis of intelligence, it is alleged that the appellant had though provided services under the categories of 'Event Management Services' and 'Club or Association Service' during the period from 01.04.2006 to 31.03.2011 and received a total consideration of Rs. 203,19,49,165/- for rendering the said services, failed to discharge service tax of Rs. 22,72,51,405/-. It is alleged that the appellant is an association affiliated to BCCI which was formed with an objective to control, regulate, help, encourage, promote and develop the game of cricket in the state of Karnataka. They are engaged in organising, conducting and promoting the game of cricket in line with the policy procedure of BCCI. The details of the game to be played both at state level and international level are provided by BCCI. The appellant undertook planning of these games, decided the schedule of the games to be conducted all over the places of Karnataka; organise all the requisite arrangements and conduct the games, tournaments on behalf of BCCI and also they promote sports of cricket by undertaking camps / tournaments in different parts of Karnataka. They also provide cricket stadium to condu....
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....r events undertaken by KSCA and (c) club/association services. 5.2. The appellant conducts cricket matches as an affiliate of BCCI as well as its own matches. When they conduct matches for BCCI, hosting fees are paid to the appellant. It is his submission that for such matches, the BCCI does not approach any state association for planning, promotion, organising or presentation of game of cricket. The BCCI merely allots the cricket matches to be played in a particular state on the basis of 'rotation system' and such allotment is based on various parameters such as visiting teams, itinerary agreed to between BCCI and teams, approvals by ICC etc. BCCI only informs the appellant about the matches to be played in their stadium. Further, he has submitted that BCCI pays hosting fees to the appellant for conducting such matches and it provides ad hoc amounts to the appellant under the head of 'Advance against amount due to association'. The difference between hosting fees and ad hoc amounts received by the appellant from the BCCI is that the former is match specific and is received after every specific allotted match is conducted, whereas the latter is a lump sum ad hoc amount which is ....
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....es provided by the appellant to the members classified under the category of 'Club or Association Service' is concerned, they are duly registered under the Karnataka Societies Registration Act and providing services to its members against collection of membership fees. Therefore, based on the doctrine of mutuality, the services provided by the appellant to its members are not taxable as held by the Hon'ble Supreme Court in the case of State of West Bengal Vs. Calcutta Club Limited [2019(29) GSTL 545 (SC)]. 5.4. He has further submitted that the learned Commissioner in the impugned order has also confirmed the demand on the taxable category of 'Event Management Service' defined under Section 65(40) of the Finance Act, 1994. It is submitted that a perusal of the said definition of 'Event Management Service', it indicates that for a service to qualify as an event management service, it must relate to planning, promotion, organisation or presentation of any arts, entertainment, business, sports, marriage or any other event and includes any consultations provided in this regard. Also, referring to the definition of 'event manager' prescribed under Section 65(41), he has submitted tha....
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....ce. They only purchase tickets and witness match and has no role in any activity pertaining to organising of the match. He has submitted that the circular issued by the Board is binding on the Department. In support, he has referred to the following judgments:- i. CCE&ST, Rohtak Vs. Merino Panel Products Ltd. [2023(383) ELT 129 (SC)] ii. CCE Vs. Dhiren Chemical Industries [139 ELT 3 (SC)] iii. Catholic Syrian Bank Vs. CIT [2012(343) ITR 270 (SC)] 5.6. It is his contention that even in respect of IPL matches, the appellant has no role to play in organising of the matches except renting of the stadium and other allied services. The said position could be seen on perusal of the Franchisee Agreement entered into between the appellant and the franchisee i.e. M/s. Vivid Kreations with respect to Karnataka Premier League (KPL). It was agreed to establish and operate a cricket team in pursuance of a tender and clearly states that the same does not qualify the appellant as an 'event manager'. In pursuance to the said agreement, the appellant enters into an agreement with an event manager who is responsible for activities such as marketing, development of KPL, i....
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.... under the taxable category of 'Event Management Services', on the reimbursement received, which clearly indicate that such cricketing services held to be outside the scope of service tax. Further, they have referred to the judgment of the Tribunal in the case of Tamil Nadu Cricket Association Vs. CST, Chennai [(2023) 7 Centax 85 (Tri. Mad.)] wherein it was held that the consideration received by the association from BCCI for conducting matches cannot fall under the scope of support service for business. Similarly, in the case of CCE&ST Vs. Saurashtra Cricket Association [(2023) 4 Centax 125 (Tri. Ahmd.)] and later affirmed by the Supreme Court, it has been held that money received from BCCI as reimbursement for the expenses incurred for conducting cricket matches are not in the nature of taxable services. 5.9. It is further submitted that the learned Commissioner has confirmed the demand invoking extended period of limitation alleging suppression of facts which cannot be sustained as the appellant's activities have been periodically subjected to scrutiny and show-cause notices have been issued from time to time demanding service tax under the category of Sale of Space/ Time for....
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.... Commissioner has rightly confirmed the demand invoking extended period of limitation. 7. Heard both sides and perused the records. 8. The issues involved in the present appeal for determination are whether the amount reflected in the balance sheet viz. BCCI fund and advance & deposits, receipt for cricketing activities, TV Subvention money, sponsorship subsidy and other receipts, match fees and other receipts, hire charges and rental fall within the scope of definition of 'Event Management Service' and the amount received as miscellaneous receipts and sponsorship fee, other receipts, receipts from clubhouse, associate fees and other membership fees, clubhouse and other membership fees, chamber revenue would be taxable under the category of 'Club or Association Service'. Revenue's allegation is that the aforesaid activities undertaken by the appellant squarely fall under the category of 'Event Management Service' and the consideration received as detailed above on various heads is taxable under the said category and demands were confirmed accordingly. Also, the membership fees collected was taxable under 'Club or Association Service'. 9. Undisputed facts of the case are th....
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....the scope of 'Event Management Service': Event management service: 1. The section referred to hereinafter are the sections or clauses of the Finance Act, 1994 as amended by the Finance Act, 2002. Reference to sub-clause or clause means clause or sub-clause of section 65 of the Finance Act, 1994 as amended by the Finance Act, 2002. 2 As per clause (34), "event management" means any service provided in relation to planning, promotion, organising or presentation of any arts, entertainment, business, sports or any other event and includes any consultation provided in this regard. Vide clause (90)(zu), taxable service means any service provided to a client, by an event manager in relation to event management. Event manager has been defined in clause (35) as any person who is engaged in providing any service in relation to event management in any manner. 3. An event manager is hired to execute an event such as product launch of any corporate, promotional activities, concerts/ rock show, official meets, award functions, beauty pageants, entertainment events, exhibitions, private functions, and sports events etc. Event manager uses his expertise and idea....
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.... of Event Management Service in the context of organisers of trade fairs and exhibitions clarified as follows:- Reference code Issue Clarification 041.01/23-8-07 Organizers of Trade Fairs and Exhibitions solicit participation from the trade and industry and provide space and other facilities, including furniture, cabins, security, electricity, etc., to display products and provision of services. Whether services provided by the organizers of trade fairs/exhibitions are covered within the scope of event management service [section 65(015)(zu)]? Trade fairs and exhibitions are organised by persons. Such organisers of trade fairs and exhibitions provide services to exhibitors in relation to business exhibition. Services provided by an organizer of trade fairs and exhibitions to an exhibitor in relation to business exhibition is liable to service tax under "Business Exhibition Service" [Section 65(105)(zzo)] w.e.f. 10-9-2004. In addition, an organiser of the trade fair or business exhibition may engage an event manager to provide service to the organiser in relation to organising trade fairs and exhibitions. In such cases, the event manager renders the service of "....
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.... Department's approach in relation to the service of hosting cricket matches is that the role of the state association is considered to be that of supporting the business of the BCCI and the attempt was to bring the said services rendered by the state associations to BCCI under the scope of taxable services of 'Business Auxiliary Service' and /or 'Business Support Service'. 16. While responding to a similar line of argument of the Revenue in the case of Vidarbha Cricket Association (supra) the Tribunal observed as:- 5.5 The next issue for consideration is leviability of service tax on the amounts received from BCCI by the appellant by way of subsidies. Revenue's contention is that these amounts have been paid to the appellant for infrastructural support rendered by the appellant to BCCI. 5.5.1 The following subsidies have been given by BCCI - 1) TV Rights subsidy; 2) BCCI tournament receipts; 3) Infrastructure subsidy; 4) BCCI IPL subsidy; 5) Players expenses reimbursements; 6) lease fees for Corporate Box; and 7) subsidy granted by BCCI. The nature of these subsidies needs examination. From the minutes of the BCCI's meetings distributing subsidies, the followi....
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....n processing. Explanation - For the purposes of this clause, the expression 'infrastructural support services' includes providing office along with office utilities, lounge, reception with competent personnel to handle matches, secretarial services, internet and telecom facilities, pantry and security. From the above definition, it is evident that the support services should be provided in relation to business or commerce. The question is whether conducting cricket tournaments and telecasting the same would constitute business or commerce. 5.5.4 A similar issue came up for consideration before the Hon'ble Apex Court in the case of Secretary, Ministry of Information and Broadcasting v. Cricket Association of Bengal (supra) and it was held.as follows :- ".........An organization such as BCCI or CAB in the present case which are indisputably devoted to the promotion of the game of cricket, cannot be placed in the same scale as the business organizations whose only intention is to make as large a profit as can be made by telecasting the game. Whereas it can be said that there is hardly any free speech element in the right to telecast when it is asser....
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....s clearly emerges that, the service, if at all any, rendered by the appellant is not in relation to any business or commerce and therefore, there is no service tax liability on the said activity under Section 65(104c) read with 65(105)(zzzq) of the Finance Act, 1994. 17. While analysing the issue, this Tribunal also recorded that the adjudicating authority in the case of Gujarat Cricket Association and Saurashtra Cricket Association dropped the demand on such services under the alleged taxable category of 'Event Management Service' observing as below:- 5.5.5 From the records, it is seen that the very same activity was examined by the Commissioner of Service Tax at Ahmedabad in the case of Gujarat Cricket Association and Saurashtra Cricket Association and by the Commissioner of Central Excise (Appeals), Pune, in the case of Maharashtra Cricket Association as to their taxability under 'event management service' and the demands were dropped vide orders dated 24-9- 2007, 27-3-2009 and 28-7-2006 respectively. Consequently, they have held that the appellant are not liable to service tax under the category of 'Business Support Service' recording as follows:- 5.5.6 ....
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....strue what is meant by "constituted" under an instrument of partnership, which words occurred in Section 26A of the Income Tax Act, 1922. The Court held : "The word "constituted" does not necessarily mean "created" or "set up", though it may mean that also. It also includes the idea of clothing the agreement in a legal form. In the Oxford English Dictionary, Vol. II, at pp. 875 & 876, the word "constitute" is said to mean, inter alia, "to set up, establish, found (an institution, etc.)" and also "to give legal or official form or shape to (an assembly, etc.)". Thus the word in its wider significance would include both, the idea of creating or establishing, and the idea of giving a legal form to, a partnership. The Bench of the Calcutta High Court in the case of R.C. Mitter and Sons v. CIT [(1955) 28 ITR 698, 704, 705] under examination now, 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 applica....