Services provided by ‘Mandap Keepers’ and Pandal or Shamiana contractors — Clarification - Service Tax - Trade Notice No. 28-C.E./97 (Service Tax) - Chandigarh

Attention of the trade and all others concerned is invited to the budget proposals 1998-99 relating to service tax. Service tax on the services provided inter alia by pandal or shamiana contractors has been exempted vide Notification No. 49/98-ST, dated 2-6-1998. It is however understood that there is a mistaken belief in some quarters that service tax has also been abolished on the service rendered by Mandap Keepers. It is clarified that a Mandap Keeper is different from the pandal or shamiana contractor in terms of the services provided by them. This is evident from the definition of the two given vide Section 65 of the Finance Act 1994 as it stood before the 1998-99 budget proposals were introduced. A Mandap Keeper has been defined as a person who allows temporary occupation of a mandap, i.e. any immovable property as defined in Section 3 of the Transfer of Property Act, 1882 and includes any furniture, fixtures, light fittings and floor coverings therein, for consideration for oganising of any official, social or business function. A pandal or a shamiana contractor has been defined as a person engaged in providing any service, either directly or indirectly in connection with the preparations, arrangement, erection or decoration of a pandal or shamiana i.e. place specially prepared or arranged for organising an official, social or business function, and includes the supply of furniture, fixtures, lights light fittings, floor covering and other articles for use therein. It is therefore, clarified that service tax will be continued to be payable by the Mandap Keepers.