2014 (5) TMI 183 - CESTAT NEW DELHI

Club or Association service - principal of mutuality - services being provided by M/s Electronic and Computer Software Export Promotion Council (ECSEPC) and Federation of India Chambers of Commerce and Commerce and Industry (FICCI) - Held that:- FICCI and ECSEPC are engaged in activities having objectives which amount to public service and are of a charitable nature; the appellant ECSEPC is also a body falling within the exclusionary clause (i) of Section 65(25a) of the Act

Services provided by appellants to their respective members and consideration received therefor is not exigible to tax in view of the principle of mutuality - The services provided by the appellants is not authorised for levy and collection of service tax under ‘Club or Association’ service, in view of declaration of unconstitutionality of the relevant and applicable provisions, by the judgment of the Gujarat High Court in Sports Club of Gujarat Limited vs. Union of India [2013 (7) TMI 510 - GUJARAT HIGH COURT]

Services provided by the appellants to non members and the consideration received for rendition of such service, fall outside the scope of the definition of ‘Club or Association’ service and the taxable service defined in Section 65(25a) read with Section 65(105)(zzze) of the Act, prior to 01.05.2011

Services provided by the appellant FICCI to non members subsequent to 01.05.2011, though presumably may fall within the expanded scope of the taxable ‘Club or Association’ service, (by virtue of the amendments by the Finance Act, 2011), the proportionate service tax and interest for these services provided subsequent to the amendments w.e.f. 01.05.2011 (not identified in the impugned order), cannot be sustained since the show cause notice dated 28.12.2012, issued to FICCI covering part of the post amendatory period omits to allege FICCI’s liability to tax on the basis of the amended provisions and thus there is denial of due process

Invocation of the extended period of limitation for initiation of proceedings against both the appellants, to the extent the extended period is invoked and the confirmation of penalties, is unjustified and unsustainable - Decided in favor of assessee.