Case Law Details
M/s Lallooji & Sons Vs Commissioner of Central Excise & S. T. (CESTAT Allahabad)
Conclusion: Service tax was not leviable for setting up of temporary camps in connection with the Gur-ta-Gaddi Tercentenary Celebration as it was a religious event.
Held: It was noticed by Revenue that assessee had received amount of Rs. 16.82 crores from District Collector for setting up temporary camps on the occasion of Gur-ta-Gaddi Tercentenary Celebration. It appeared to Revenue that the said service attracted service tax on „Pandal or Shamiana Service‟ and circular No.79/9/2004-ST dated 17.09.2004 exempting service provided for religious ceremonies was superseded by a master circular issued on 23.08.2007, therefore, assessee was liable to pay service tax. It was held the event was a social function which involved religious rites/ceremonies and being a social event, all Pandal/ Shamana services provided in relation to it were liable to suffer Service Tax. However, the decision of the Allahabad High Court in assessee’s own case vide Civil Misc. Writ Petition (Tax) No.768 of 2005 dated 20.07.201, it was held that Mela was a religious function and religious functions were covered by the said circular dated 17.09.2004 was still applicable. Relying on the decision, Tribunal noted that the ceremony for which assessee had provided the services was religious and from the opening sentence of certificate dated 23.10.2008 issued by District Collector showed that the said ceremony called “Gur-ta-Gaddi Tercentenary Celebration” was an event of great religious significance. Therefore, service tax was not leviable for setting up temporary camps on the occasion of Gur-ta-Gaddi Tercentenary Celebration.
FULL TEXT OF THE CESTAT JUDGMENT
The present appeal is directed against Order-in-Original No. (ST-208/2013) 02 of 2015 dated 19/01/2015 passed by Commissioner of Central Excise & Service Tax, Allahabad.
2. Brief facts of the case are that the appellants were engaged in providing „Pandal or Shamiana and Goods Transport Agency Services‟. During the scrutiny of records of the appellant, it was noticed by revenue that appellant had received around Rs. 16.82 crores from District Collector, Nanded against Work Order dated 14.08.2008 for the period from 01.04.2008 to 31.03.2009 for setting up temporary camps at South Nanded and Nerli on the occasion of Gur-ta-Gaddi Tercentenary Celebration. It appeared to revenue that the said service attracted service tax on „Pandal or Shamiana Service‟. There was exchange of correspondence between appellant and revenue and the contention of appellant was that the occasion for which said service was provided was religious and as per Circular No.79/9/2004-ST dated 17.09.2004- „if the service is provided for religious ceremonies, service tax is not chargeable‟. Revenue entertained in a view that the said circular was superseded by a „Master Circular‟ issued on 23.08.2007 and therefore the appellants were liable to pay service tax of Rs.2,07,93,875/-. Therefore, with such proposals show cause notice dated 01.10.2013 was issued. The said show cause notice was adjudicated on contest through the impugned Order-in-Original wherein the Original authority has confirmed the demand with interest and equal penalty. Aggrieved by the said order, appellant is before this Tribunal.
3. Heard the learned Counsel for appellant. He has submitted that similar issue had come up before the Hon‟ble Allahabad High Court in the appellant‟s own case vide Civil Misc. Writ Petition (Tax) No.768 of 2005 which was decided through judgment dated 20.07.2015 reported at 2015-TIOL-1696-HC-ALL-ST. He has further submitted that in respect of Magh Mela organization at Allahabad, the Office In-charge Magh Mela, Allahabad denied payment on component of service tax on Pandal or Shamianas provided by the present appellant and such decision of the said officer was challenged before the Hon‟ble Allahabad High Court. He submitted that through the said judgment dated 20.07.20 15 Hon‟ble Allahabad High Court in para- 14 had held that Mela was a religious function and religious functions were covered by the said circular dated 17.09.2004. Learned Counsel further submitted that the ruling by Hon‟ble Allahabad High Court was to the effect that if a Pandal or Shamiana is provided for a religious function then as per said circular dated 17.09.2004 service tax is not payable. He has further brought our attention to the certificate dated 23.10.2008 issued by Collector, Nanded (a copy of which is available at page no.186 of appeal paper book) wherein it was stated that Gur-ta-Gaddi Tercentenary Celebration was an event of religious significance. He has further prayed to set aside the impugned order.
4. Heard the learned A.R. for revenue who has supported the impugned Order-in-Original.
5. Having considered the contentions from both the sides and on perusal of ruling by Hon‟ble Allahabad High Court and certificate issued by District Collector, Nanded, we note that the issue to be decided herein is whether the said ceremony called Gur-ta-Gaddi Tercentenary Celebration held at Nanded, Maharashtra was a religious ceremony or not. For the sake of appreciation of issue, we are reproducing below the finding of Original authority through the impugned order at para-12:-
“12. One of the reasons mentioned in the show cause notice for demand of service tax from the party, is the withdrawal of CBEC Circular No.79/9/2004-ST dated 17.09.2004 vide issuance of two Master Circulars issued by CBEC Circular No.96/7/2007-ST dated 23.08.2007 and Circular No.97/7/2007-ST also dated 23.06.2007. Since in these Master Circulars, it is mentioned that they supersede all circulars, clarifications and communications, it is mentioned in the show cause notice that by virtue of these Master Circular, the Circular dated 17.09.2004, which exempted payment of Service Tax with respect to services provided for pure religious ceremonies stands withdrawn. Accordingly, it is mentioned in the show cause notice, that since the Circular dated 17.09.2004 stands withdrawn, the services provided by the party at Nanded are liable to be charged to Service Tax.
The party in their defence reply has repeatedly stated that the departmental Circular clarification issued in 2004, to the effect that service provided with respect to pure religious events is exempt from payment of service tax, still holds good. In context of the above argument of the party, I hold that the party may have their own arguments about non withdrawal of exemption to services related to pure religious events, but the demand in the present show cause notice is not based solely on this premise. As discussed earlier, the event at Nanded was a social function which involved religious rites/ceremonies and as such, being a social event, all Pandal/ Shamana services provided in relation to it are liable to suffer Service Tax.”
We find that the Hon‟ble Allahabad High Court has ruled that the said CBEC Circular dated 17.09.2004 was still applicable.
6. Therefore, now the only question to be decided is whether the ceremony for which the appellant had provided the services was religious or not.
We find from the opening sentence of certificate dated 23.10.2008 issued by District Collector, Nanded that the said ceremony called “Gur-ta-Gaddi Tercentenary Celebration” was an event of great religious significance. We, therefore, hold that the impugned order is not sustainable.
7. We, therefore, set aside the impugned order and allow the appeal. The appellant shall be entitled for consequential relief, as per law.
(Pronounced in Court on-16/11/2018)
