In a major relief to the IPL Team Rajasthan Royals, the Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Mumbai Bench consisting of S.K. Mohanty And M.M. Parthiban has held that service tax is not applicable on sale of tickets for cricket tournaments.
BACKGROUND
The appellants-assessee is operating a cricket team in the name and style of Rajasthan Royals (RR) in the cricket tournament organised by the Board of Control for Cricket in India (BCCI). The tournament is popularly known as Indian Premier League (IPL). The appellants-assessee are engaged in providing the services under the taxable category of ‘management consultant service’, ‘sponsorship service’ and ‘Business Auxiliary Service’, defined under the Finance Act, 1994. They are duly registered with the jurisdictional service tax authorities for providing such taxable services.
With regard to confirmation of Cenvat demand on sale of tickets and prize money, the appellant submitted that receiving the prize money for proper performance in the matches cannot be termed as a service inasmuch as there is no relationship exists with the service provider and service receiver in order to fall under the category taxable services of Business Support Service. Thus, the appellant was not statutorily required to reverse any cenvat credit in respect of prize money.
OBSERVATION
The court held that the amount has been received by the appellant as the sale of ticket for cricket tournament which is not service, therefore, when it is not the service, it cannot be termed as service, no service tax is required to be reversed. Further, for the period 2010-12, the appellant-assessee has also reversed the said amount, therefore, no demand is sustainable on that account.
Case Title: M/s Jaipur IPL Cricket Pvt. Ltd. Versus PCIT
Citation: Service Tax Appeal No. 87230 of 2015