2011 (11) TMI 290 - AT - Service Tax

Mandap Keeper assessee owns Guest house & garden given on rent for marriage functions - registered for providing the taxable service of Pandal or Shamiana in Nov 04 Revenue is of view that services provided by assessee were of Mandap Keeper service which were taxable since 1/7/97 Held that - By campaigning the definition of the service provided by Mandap keeper and Pandal or Shamiana contractor it will be seen that while in the former the emphasis is on temporary occupation of Mandap which is an immovable property under the control of Mandap keeper by a client for consideration for organising any official social or business function alongwith other facilities like lighting providing of furniture fixture catering etc. in the latter the emphasis is on preparing a premises chosen by the customer for official business or social function by providing furniture fixtures Pandal floor coverings lighting and light fittings etc. In the present case temporary occupation of guest house & garden was being allowed to the customers along with other facilities for organising marriage functions. Since marriage function is a social function thus the appellant s activity was classifiable as service provided by Mandap keeper. Further just because an explanation was added w.e.f. 1/6/07 that for the purpose of this clause clarifying that the social function includes the marriage function also it cannot be concluded that during the period prior to 1/6/07 the marriage function was not a social function. The explanation added w.e.f. 1/6/07 has to be treated as a clarificatory explanation only Decided against the assessee.

Summary

Issues:
1. Classification of services provided by the appellant as Mandap Keeper service or Pandal or Shamiana service.
2. Taxability of services provided by the appellant for marriage functions.
3. Interpretation of the definition of social functions in relation to marriage functions.

Analysis:

Issue 1: Classification of services provided by the appellant
The appellant owned Heera Panna Guest House and Tiranga Garden, providing services for marriage functions. The question was whether these services fell under Mandap Keeper service or Pandal or Shamiana service. Mandap Keeper service involves temporary occupation of an immovable property for functions, while Pandal or Shamiana service includes preparing a place for official, social, or business functions. The Tribunal determined that the appellant's activity constituted allowing temporary occupation of a Mandap, making it taxable under Mandap Keeper service, not Pandal or Shamiana service.

Issue 2: Taxability of services for marriage functions
The appellant argued that since the services were provided in connection with marriage functions, which they considered religious, not social, the services were not taxable. However, the Tribunal held that marriage functions are social events, even without religious elements, and are taxable under Mandap Keeper service. The clarification added to include marriage functions as social events was deemed clarificatory and not retrospective.

Issue 3: Interpretation of social functions in relation to marriage functions
The Tribunal affirmed that marriage functions are social events, distinct from the marriage ceremony itself. The explanation added to the definition of social functions was seen as clarifying existing practice, not changing the nature of marriage functions. Therefore, services provided for marriage functions were deemed taxable under Mandap Keeper service.

In conclusion, the Tribunal allowed the Revenue's appeal, setting aside the Commissioner (Appeals)'s classification of the appellant's services as Pandal or Shamiana service. The appellant's appeal was dismissed, upholding the taxability of services for marriage functions as social events even before the clarification added to the definition of social functions.