TaxTMI 
TaxTMI 
2026 (10) TMI 122
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...., Chennai in Service Tax Appeal No.40038 of 2020. 2.The appellant before us is a scheduled private bank. The period involved is October 2013 - June 2017. The appellant had made payments to certain organizations during this period. According to the appellant, they were donations for charitable purposes. The department thought otherwise. To them, they were sponsorships. Sponsorships are liable to service tax. Show cause notice dated 15.04.2019 was issued by the Commissioner of GST and Central Excise, Trichy proposing levy of service tax on the petition-mentioned transactions. The appellant submitted a detailed reply. The appellant's stand was rejected and the order dated 30.09.2019 was passed confirming the demand set out in the show c....
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....e revenue submitted that the appellant did not provide full and complete details and that was why, the benefit sought for by the appellant could not be granted. Only for want of proper particulars, the demand raised against the appellant came to be confirmed. He added that the tribunal had given sound and convincing reasons and that the impugned order does not call for interference. He drew our attention, in particular, to Paragraph Nos.12.2, 12.12 & 12.14. He called upon this Court to dismiss this appeal by answering the question of law in their favour. 5. We carefully considered the rival contentions and went through the materials on record. The service tax regime was introduced in the year 1994. The list of items taxed under the head ....
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....clusive or priority booking rights, sponsoring prizes or trophies for competition; but does not include any financial or other support in the form of donations or gifts, given by the donors subject to the condition that the service provider is under no obligation to provide anything in return to such donors" 6.The primary question that calls for consideration is whether the petition-mentioned transactions would attract the aforesaid definition? The appellant bank had contributed monies to various activities such as construction of toilets, school buildings, temple towers etc., According to the appellant, they were pure donations and nothing else. 7.The issue of onus may first be disposed of. The appellant is not seeking exemption from....
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....tax is a question of fact. The bank would say that it was a pure donation without any business motive. Beyond the request letter and the details regarding the payment, no other particulars can be furnished by the bank. If according to the revenue, this transaction amounts to "sponsorship" within the meaning of Section 65(99a) and the donor denies the same, the donor cannot be called upon to prove the negative. It is for the revenue to demonstrate that an event was conducted by SAKSHAM which was obliged to display the donor's trade name or logo as per the agreement between the parties. If the donee on their own had acknowledged the contribution made by the bank, that by itself would not subject the contribution to service tax. 8.Donor....
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....action amounts to sponsorship would depend on whether the recipient of the support is under an obligation to provide anything in return. 9.In the case on hand, the appellant had conceded that Lions Club International, District 324A2 to which a sum of Rs. 10.00 lakhs was given as donation was required to display KVB logo in the water purifiers as that would improve the bank's visibility and goodwill among the public. This requirement has been stipulated in the Board resolution itself. This obviously is a case of sponsorship within the meaning of the statutory definition. Likewise, donation made to Key Exports India, Mumbai carried a stipulation that the winter jackets meant for Mumbai - Thane Traffic Police Personnel should display KV....
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....of Swachh Bharat Mission, the appellant-bank footed the bill for construction of toilets in Gujarat. Obviously, the question of the appellant having been given exclusive or priority booking rights would not arise. No prizes or trophies for competition had been sponsored in the name of the bank. 11.Admittedly, the proceedings had been initiated after the expiry of the limitation period. The revenue's stand is that they were justified in invoking the extended period of limitation by relying on the proviso to Section 73(1) of the Finance Act, 1994. The proviso could have been invoked if any of the circumstances such as fraud, collusion, willful misstatement or suppression of facts had been present. The department had not placed any cred....