Kerala State-Ex-Services League State Committee Vs Commissioner of Central Excise Customs And Service Tax (Kerala High Court)
Kerala High Court held that services of looking after socio-economic and welfare matters of ex-serviceman by the charitable society is leviable to service tax. Accordingly, appeal dismissed the service tax leviable on the same.
Facts- The appellant in all these appeals is the Kerala State Ex-services League, which is a Charitable Society registered under the Travancore Cochin Society Registration Act, 1955 and is affiliated to the Indian Ex-Service League, New Delhi. It has its registered office at Trivandrum and the League has District Committees in all the Districts in the State of Kerala. The primary object of the League is stated to be to look after the socio-economic and welfare matters of ex-servicemen and their families.
The issue in these appeals arises from the notices issued to the appellant in 1998 asking it to register itself as a service provider under the head of “security agency service” as defined under Section 65(40) of the Finance Act, 1994 prior to 2006 and under Section 65(94) of the said Act after the 2006 amendment.
Conclusion-Held that to attract the levy of tax as applicable to the security agency services, the service has to be provided by a commercial concern engaged in the business of rendering services relating to security of any property, whether movable or immovable, or of any person, in any manner and includes the services of investigation, detection or verification of any fact or activity, whether of a personal nature or otherwise, including the services of providing security personnel. In our view, it cannot be disputed that the activity that the appellant provides is essentially the providing of security personnel, who invariably are its members, being ex-servicemen. The appellant cannot be treated at par with educational institutions, which by their very nature and going by the activities intended to be performed by them, cannot be seen as commercial concerns. We therefore find ourselves unable to accept the submissions of the learned counsel for the appellant that the appellant is not a commercial concern for the purposes of levy of service tax.
