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2023 (6) TMI 370 - CESTAT AHMEDABAD
Classification of services - services provided to customers / members for effluent treatment and disposal of waste - club and association service or not - mutuality of services - HELD THAT:- It is found from the facts of the case the appellant is having its independent processing unit for effluent treatment of industrial waste. The appellant has set up the unit with his sole capital investment. The customer for which the appellant is carrying out the effluent treatment of the waste have no legal say in the independent activity of appellant company. The appellant charge to their industrial customer for the treatment and disposal of the waste on quantitative basis.
From the above invoice it can be seen that the appellant are carrying out activity of treatment and disposal of sewage waste water for individual customer and depending upon the quantum of waste treatment they are raising the bill and collected the charges against the same. Other then this there is no subscription involved unlike the subscription between club and association and its member. The commercial dealing between the appellant and its customer is purely on principle-to-principal basis - there is no iota of doubt that there is no relationship of club and association between the appellant and its customers. Therefore, the demand raised under club or association cannot be sustained.
Even though the contention of the Revenue is accepted, the demand under club or association service shall not sustain in the light of Hon’ble Supreme Court judgment in the case of State of West Bengal vs. Calcutta Club Limited [2019 (10) TMI 160 - SUPREME COURT] wherein the Hon’ble supreme court expressed view that since there is mutuality of interest between the club or association and its members and club or association being made of its members the concept of service provider and service recipient is absent hence the service to self cannot be taxed. With this view the Apex court held that the payments received from the members of the club by club or association is not taxable for this reason also the demand is not sustainable.
The impugned order is not sustainable - Appeal allowed.