2018 (9) TMI 129 - AT - Service Tax

Club or association Service - It is submitted on behalf of appellant that the appellant has discharged its liability towards the sale of food and beverages by paying VAT for the same - Held that - The Commissioner (Appeals) in para 12 of his findings has reproduced a chart. Perusal thereof makes it clear that there is acknowledgement on the part of the Department about payment of VAT on the impugned sale by the appellant. Further, perusal of show cause notice makes it clear that the said acknowledgement is well confirming the tax liability mentioned in the show cause notice. Thus facts stand clear that the requisite liability has been discharged, as far as the sale of goods for rendering the services by the club to its members is concerned - Since for claiming said benefit, documents evidencing sale/transfer are mandatory the appellant was required to produce the same at first available opportunity i.e. the Original Adjudicating Authority. Apparently it has not been done - matter remanded back to the Original Adjudicating Authority for being decided afresh after taking into consideration the documents as that of the invoices, if any, produced by the appellant - appeal allowed by way of remand.

Summary

Issues:
- Appeal against the order of Commissioner (Appeals) regarding service tax assessment on club services provided by the appellant.
- Discrepancies in assessment related to various charges collected by the appellant.
- Dispute over the consideration of invoices for sale of food and beverages in the assessment process.

Analysis:
1. The appellant, engaged in providing club services, was under scrutiny for escaping assessment on several charges collected from members and guests. The demand raised through a show cause notice was confirmed by the original order and upheld by the impugned order, leading to the appeal.

2. During the hearing, the appellant claimed to have paid VAT for the sale of food and beverages, providing invoices to support the claim. However, the Adjudicating Authority did not consider these invoices, citing their absence during the original adjudication stage, which the appellant contested.

3. The Department argued that the appellant's failure to produce relevant documents timely was crucial, as per circular guidelines. The Commissioner (Appeals) upheld this view, emphasizing the necessity of the document evidencing the sale.

4. Upon review, it was noted that the Department acknowledged the VAT payment by the appellant for the sale in question. The circular highlighted the tax liability related to services provided by clubs to members, with specific mention of taxable amounts beyond membership fees, provided proper documentation was available.

5. Due to the mandatory requirement of documents to claim benefits, the failure to produce invoices at the original adjudication stage led to the remand of the matter back to the Adjudicating Authority for a fresh decision, considering the invoices provided by the appellant. Consequently, the appeal was allowed for remand, emphasizing the importance of documentary evidence in tax assessments.