Bharat Swabhiman (Nyas) Vs Commissioner Customs, Central Excise & Service Tax (CESTAT Delhi)
The CESTAT, Delhi in M/S. Bharat Swabhiman (NYAS) v. Commissioner Customs, Central Excise & Service Tax, Dehradun, [Service Tax Appeal No. 52849 of 2016 dated January 01, 2022] set aside the order confirming the demand of service tax. Held that, service tax will not be levied on the donations received by a trust from its members and on freight charges paid towards the activity of advancement of yoga. Further held that, activities can’t be covered under Goods and Transport Agency Service (“GTA Service”) where consignment notes have not been issued.
Facts:
M/s. Bharat Swabhiman (Nyas) (“the Appellant”) is a trust, constituted with an aim to carry out charitable objects, including yoga education and training for achieving a disease-free and healthy India. Further, the Appellant is engaged in organizing residential as well as non-residential yoga camps to propagate yoga training and Vedic knowledge, for which it received donations from its members.
An enquiry was conducted by the Commissioner Customs, Central Excise & Service Tax, (“the Respondent”) in connection with the with non-payment of service tax on membership donations, freight charges paid by the Appellant, and on the amount for hiring motor vehicles. Various Show Cause Notices (“SCNs”) were issued to the Appellant, demanding service tax with interest and penalty under the category of ‘club or association service’, ‘GTA Service’ and ‘rent-a-cab operator service’ for the period January 2009 to March 2013 which were adjudicated by the Respondent by a common order dated July, 13, 2016 (“the Impugned Order”) and the demand of service tax of INR 4,83,52,583/- was confirmed with respect to the membership donations and freight charges paid by the Appellant and the demand of service tax of INR 61,66,706/- was dropped.
Being aggrieved, the Appellant has filed this Appeal.
The Appellant contended that SCNs issued have failed to invoke any grounds on which the demand has been proposed and such demand of service tax on membership donations is not sustainable as it is exempted under Notification No. 25/2012-Service Tax dated June 20, 2012 and Notification No. 42/2016-Service Tax dated September 26, 2016 (“the Exemption Notifications”) that notified non-levy of service tax on the services by way of advancement of yoga provided by entities.
Issue:
Whether the Appellant is liable to pay the demand of service tax on the donations received from its members and on freight charges paid under the reverse charge mechanism?
Held:
