Elite Clubs and Associations under Service Tax Scanner

NEW DELHI. Delhi Gymkhana Club has been booked by service tax department for evading Service Tax amounting to Rs. 2.92 Crores in respect of taxable services of Membership of Club and Association. 

Membership of Club or Association Service was brought into service tax net with effect from 16.06.2005. However Gymkhana club did not pay any service tax on the services provided by them to their members.

The Gymkhana club has also deposited Rs. 1.93 Crores towards service tax under protest and has not filed any service tax return till date.

The Commissionerate of Service Tax,
Delhi has already issued a Show Cause Notice to Delhi Gymkhana Club for non payment of Service tax amounting to Rs. 2.92 Crores.

The Clubs and Associations are also under Service Tax scanner and the service tax demands against them are being issued according to service tax department.

Under the clauses of the Finance Act 1994 as amended;

(25a) “club or association” means any person or body of persons providing services, facilities or advantages, for a subscription or any other amount, to its members, but does not include —

(i)       any body established or constituted by or under any law for the time being in force; or

(ii)      any person or body of persons engaged in the activities of trade unions, promotion of agriculture, horticulture or animal husbandry; or

(iii)     any person or body of persons engaged in any activity having objectives which are in the nature of public service and are of a charitable, religious or political nature; or

(iv)     any person or body of persons associated with press or media;

“taxable service” means any service provided or to be provided,-

(zzze) to its members, by any club or association in relation to provision of services, facilities or advantages for a subscription or any other amount

(Source: Allindiantaxes)

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