TMI Blog2016 (3) TMI 900X X X X Extracts X X X X X X X X Extracts X X X X ..... d Tribunal, the demand of tax on receipts from members cannot sustain. Tax under Finance Act, 1994 is not on the entity or on amounts receipts by the entity - it is on specified taxable services and hence taxability can arise only to the extent that each transaction between the member and the club can meet the test of conformity with section 65(105)(zzze) ibid. Therefore, without ascertainment of the receipts as quid pro quo for an identified service, demand of tax on amount transferred from an individual to an entity merely because the individual happens to be a member, on the one hand, and the recipient happens to be club/association on the other, does not meet the test of having rendered taxable service. Also, interest, if any, on delaye ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a miscellaneous amount - all at prefixed rates - amounting to ₹ 30,24,000/- for the period from April 2005 to September 2009 which was sought to be taxed under section 65 (105) (zzzq) of Finance Act, 1994 as support services of business or commerce'. Yet another demand related to recoveries of ₹ 91,574/- from staff members who were provided with accommodation for the period from April 2005 to September 2009 that Revenue claims was liable to tax under section 65(105) (zzzz) of Finance Act, 1994 for rendering renting of immovable property service'. Appellant having registered themselves as provider of club or association service' paid ₹ 3,93,301/- as tax on the amount received from caterers under that head. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that it was not rendering any taxable service other than that of using the caterers for making food facilities available to its members, paid tax on receipts under the head of club or association service'. The adjudicating authority, while determining that the entire receipts of the appellant were liable to tax, discovered that the consideration from different entities were attributable to multiple services. Notwithstanding this finding, the impugned order has not determined the tax liability distinctly for each of the services. Impliedly, the nature of each transaction and its fitment into the various sub-clauses of section 65 (105) has not been ascertained. It is, therefore, perplexing that in determining the omnibus demand, the clai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rendered tax on the amounts collected by them during 2007-08 and, taking note of this, the impugned order has determined a small amount as taxable for the subsequent period. The contractual privileges of an employer-employee relationship are outside the purview of service tax and this activity of the appellant does not come within the definition of the taxable service of renting of immoveable property' sought to be saddled on the appellant in the impugned order. Accordingly, the demand under head renting of immovable property service' does not sustain. 8. Learned Counsel for appellant relies on the decisions of the Hon'ble High Court of Gujarat in Sports Club of Gujarat v Union of India [2013 (31) STR 645 (Guj)] and Green ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ded to its members, by any club or association in relation to provision of services, facilities or advantages for a subscription or any other amount; In its wisdom, departmental authorities have considered it fit to tax the subscription or any other amount paid by a member to the club in which membership has been obtained. Tax under Finance Act, 1994 is not on the entity or on amounts receipts by the entity - it is on specified taxable services and hence taxability can arise only to the extent that each transaction between the member and the club can meet the test of conformity with section 65(105)(zzze) supra. 10. A members' club, by its very composition, is a grouping of individuals who have chosen to be members of a particula ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ued as consideration for service and, hence, is outside the scope of taxability. 11. The club, as an entity, incurs certain expenses to keep it as a going concern; cost of maintaining the establishment, remuneration to management and staff, recurring expenses are a few of these. Not being a commercial concern, the primary wherewithal for meeting these expenses are the purse strings of the members. Periodical subscription is collected accordingly. Deficits drive the enhancements of subscription. Consequently, contribution to common expenditure cannot be considered to be consideration for services that the club renders to members. All too often, members d not derive any service by mere membership; clubs charge individually for use of facil ..... X X X X Extracts X X X X X X X X Extracts X X X X
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