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TMI Blog2018 (1) TMI 1274X X X X Extracts X X X X X X X X Extracts X X X X ..... tion fees. The services are being provided not to the share holders of the company but to third parties. As per the definition under Section 65(25)(a) club or association is a body of persons which provides services to its members. Subsequently, w.e.f. .01.05.2011, the definition was changed and Section 65(25)(a) was replaced by Section 65(25)(aa) to add the word Primarily to its members. The services in question are being provided not to its share holders, who are the members of the company but to other persons who are third parties - for the period after 01.05.2011 upto 30.06.2012, the show cause notice has not made any allegation invoking Rule 65(25)(aa), which had come into effect after that date - For the period after 01.07.2012, in the negative list of services on which service tax is exempted, the services of public libraries are exempted under N/N. 25/2012-ST dated 20.06.2012. Appeal allowed - decided in favor of appellant. X X X X Extracts X X X X X X X X Extracts X X X X ..... ria that a public library should be funded or aided by the Government. In this regard, he invited attention to the definition of public place in the judgment of Hon'ble Supreme Court in the case of Gaurav Jain V. Union of India, 1997 AIR (SC) 3021. He also pointed out that though there are private transport companies carrying the passengers in their buses but still the same is called as public transportation. Hence, in common parlance, he argued, the public means which is accessible to general public. He also relied on the following judgments: (i). M/s Federation of India Chambers of Commerce and Industry reported in 2015 (38) S.T.R. 529 (Tri. - Del.) (ii). Ranchi Club Vs. CCE, Ranchi reported in 2012 (3) JCR 123. (iii). Pandurang Chimaji Agale reported in AIR 1988 BOM 248. (iv). Union of India Insurance Ltd. Vs. Parvati Devi and Anothers reported in I (2000) ACC 75, 1999 ACJ 1520. 4. Heard the parties and perused the record. We find that the appellants are a private limited company registered under the companies Act. They have a book store containing fiction and non-fiction books. They enrol members who wish to borrow books for their reading pleasure against varying annua ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tivity for which they charge subscription fees. The services are being provided not to the share holders of the company but to third parties. As per the definition under Section 65(25)(a) club or association is a body of persons which provides services to its members. Subsequently, w.e.f. .01.05.2011, the definition was changed and Section 65(25)(a) was replaced by Section 65(25)(aa) to add the word Primarily to its members. The services in question are being provided not to its share holders, who are the members of the company but to other persons who are third parties. The borrowers of the books are not members even on temporary basis. In this context, we note that Hon'ble Jharkhand High Court in the case of the Ranchi Club (supra) has held as below: "17. The Full Bench of Patna High court in the case of writ petitioner itself i.e., in the case of Commissioner of Income Tax v. Ranchi Club Limited (Supra), after finding that Ranchi Club is a limited company incorporated under the Indian Companies Act, considered the various clauses of the main objects of the club and relying upon various judgements, in paragraph 12 observed as under:- "12. Therefore, by applying the principle ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (e) Services provided by the appellant FICCI to non members subsequent to 01.05.2011, though presumably may fall within the expanded scope of the taxable Club or Association service, (by virtue of the amendments by the Finance Act, 2011), the proportionate service tax and interest for these services provided subsequent to the amendments w.e.f. 01.05.2011 (not identified in the impugned order), cannot be sustained since the show cause notice dated 28.12.2012, issued to FICCI covering part of the post amendatory period omits to allege FICCIs liability to tax on the basis of the amended provisions and thus there is denial of due process; and" By following the above judicial pronouncements, we hold that the demand for the period upto 30.06.2012 is not sustainable. 10. For the period after 01.07.2012, in the negative list of services on which service tax is exempted, the services of public libraries are exempted under Notification No. 25/2012-ST dated 20.06.2012. We find that the Revenue has interpreted the word public to allege that the source of funding or grant of aid from the Government funds is an essential criteria. As has been rightly pointed out by the Ld. Advocate, common p ..... X X X X Extracts X X X X X X X X Extracts X X X X
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