Patanjali Yogpeeth Trust Vs Commissioner of Central Excise (CESTAT Allahabad)
CESTAT Allahabad held that service tax is leviable on services relating to health & fitness by way of teaching yoga and meditation under the category of ‘Health and Fitness Services’.
Facts- The appellant is engaged in activity of providing services relating to health & fitness by way of teaching yoga and meditation. Based on the intelligence that appellant-trust working under the aegis of Baba Ramdev and Acharya Balkrishna are inter-alia engaged in providing Yoga training to various residential and non-residential camps. For participation in such camps, a charge of participation fees from the participants on the name of donation was taken. Though this amount was collected at donation but it was fees for providing the said services and hence covered under the definition of consideration.
Conclusion- Held that the amounts received by the appellant as donation, was nothing but the consideration for the provision of service taxable under the category of Health and Fitness services.
Held that the penalties under Section 76 and 77 are for the violation done and are absolute in nature if certain violations are attributable to the appellant. In the present case undoubtedly appellant had failed to take registration as required even though he was providing the taxable services. It is also the fact that they were not paying service tax and not filing the returns as required under provisions of Service Tax law, i.e Chapter V of Finance Act, 1994 and Service Tax Rules, 1994. For the contraventions of these provisions penalty imposed on the appellant under Section 76 and 77 cannot be faulted with.
FULL TEXT OF THE CESTAT ALLAHABAD ORDER
This appeal is directed against Order-in-Original No.38/Commissioner/Meerut-I/2012 dated 23/10/2012 passed by Commissioner of Customs & Central Excise, Meerut-I. By the impugned order following has been held:-
ORDER
i. I hereby confirm the demand of Service Tax amounting to Rs.4,94,33,027/- (Four Crore Ninety Four Lac Thirty Three Thousand and Twenty Seven Only) including E. Cess & S.H.E Cess, under proviso to Section-73(1) of the Finance Act, 1994.
ii. The above said noticee is also liable to pay interest at applicable rates on above said confirmed demand of Service Tax amount, under Section 75 of the Finance Act, 1994.
iii. I hereby impose a penalty on noticee under Section 76 of the Act, for their failure to pay service tax by due dates. The penalty is imposed @ Rs. 200/- (Rs. Two hundred only) for every day (up to 09.05.2008) during which such failure continues or at the rate of 2% of such tax, per month, whichever is higher starting with the first day after the due date till the date of actual payment of the outstanding amount of Service Tax. However, the total amount of the penalty payable in terms of this section shall not exceed the amount of Service Tax payable upto 09.05.2008.
iv. I further, impose a penalty of 4,94,33,027/- (Four Crore Ninety Four Lac Thirty Three Thousand and Twenty Seven Only) under Section 78 of the Finance Act, 1994 for their failure to pay Service Tax by suppressing the value of taxable service & also various acts of omission and commission.
v. I also impose a penalty under Section 77 for their failure to take registration in accordance with the provisions of Section 69/ rules made thereunder at the rate of two hundred rupees for every day during which such failure continued, starting with the first day after the due date, till the date of actual compliance;”
2.1 The appellant is engaged in activity of providing services relating to health & fitness by way of teaching yoga and meditation. During the relevant period in dispute appellant had not taken any registration, which is requisite under the Finance Act, 1994 as amended. They were not paying any service tax on the services provided by them.
2.2 Based on the intelligence that appellant-trust working under the aegis of Baba Ramdev and Acharya Balkrishna are inter-alia engaged in providing Yoga training to various residential and non-residential camps. For participation in such camps, a charge of participation fees from the participants on the name of donation was taken. Though this amount was collected at donation but it was fees for providing the said services and hence covered under the definition of consideration.
2.3 Inquiries/investigations were made by Directorate General of Central Excise Intelligence and statements of Shri Shyamvir Singh Saini, Chief Accounts Officer of appellant and Shri Acharya Balkrishna were recorded. Enquiries were made from the various Yog Shivir Ayojan Samities at Varanasi. On the basis of above investigations a show cause notice dated 24.04.2012 was issued to the appellant, asking them to show cause as to why-
31.1 “An amounting to Rs.4,94,33,027/- (Four Crore Ninety Four Lac Thirty Three Thousand and Twenty Seven Only) being Service Tax, E. Cess & H.E Cess, not paid during the period from 01.10.2006 to 31.03.2011, should not be demanded from them under proviso to Section-73(1) of the Finance Act, 1994;
31.2 Interest under Section 75 of Finance Act, 1994 should not be demanded from them; and
31.3 Penalty should not be imposed upon them under Section 76, 77 & 78 for their various acts of omission and commission as detailed in the previous paras.”
2.4 This show cause notice was adjudicated through the impugned Order-in-Original referred in para-1 above. Aggrieved appellant has filed this appeal.
3.1 We have heard Shri Atul Gupta & Shri Prakhar Shukla learned advocates appearing for the appellant and Shri Sarweshwar T. Khairnar learned Authorised Representative appearing for the revenue.
3.2 Arguing for the appellant learned Counsel submits that
➣ following questions need to be determined in the present case:-
