Chargeability of service tax on the activity of letting out stalls near the temple during a festival

PJ/Case Law /2016-17/3413

Case:- SHRI CHATUSHRINGI SEVA SAMITTEE Versus COMMISSIONER OF C. EX., PUNE-III
Citation:-2015 (39) S.T.R. 169 (Tri. - Mumbai)
Brief facts:- Both the sides were heard. Common issue was involved, therefore the appeals were taken up together. The appellants filed these appeals challenging the impugned order whereby demands of Service Tax were confirmed on the ground that the appellants provided service of mandap keeper.
Appellant’s contention:- The contention of the appellants is that the appellants are Charitable Trusts registered under the Income-tax Act and engaged in the activity of managing the affairs of a temple. During Navratri days, the devotees came to the temple and during this period, some stalls were let out to different persons for the business of selling toys, garlands, flowers, food etc. in the open place adjoining to the temple. The appellants produced copy of tenders under which the stalls were allotted to different persons. The contention is that this activity does not fall under the scope of “mandap keeper service” hence the demands are not sustainable.
Respondent’s contention:- The Revenue relied upon the findings of the lower authority and submitted that as the appellants are arranging a social function in the form of Navratri festival, therefore the demands are rightly made.
Reasoning of judgment:- The Tribunal found that the demands are confirmed under the “mandap keeper service”. As per the provisions of Sections 65(67) and 65(105) of the Finance Act, ‘mandap keeper’ means a person who allows temporary occupation of a mandap for a consideration for organizing any official, social or business function.
In the present case, even in reply to show cause notice, the appellants stated the facts that certain stalls are allotted to different persons for selling different items such as toys, garlands, flowers, food etc. and produced evidence in support of this claim. In view of this, the Tribunal found merit in the contention of the appellants that the appellants are not covered under the scope of “mandap keeper service”. The impugned orders were set aside and the appeals were allowed.
Decision:-Appeal allowed.
Comment:-The gist of the case is that the assessee was engaged in managing the affairs of a temple and let out stalls for business during festival. Stalls near the temple were allotted to different persons for selling toys, garlands, flowers, foods, etc. It was held that since, the aforesaid service is not covered under the scope of “mandap keeper service”, it was not liable to service tax and the impugned order was set aside in accordance with sections 65(67) and 65(105) of Finance Act, 1994.
Prepared by:-Praniti Lalwani

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PJ/Case Law /2016-17/3413

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