ICC seeks exemption from service tax on membership fees
By: ICN Bureau
Last updated : March 06, 2018 8:18 pm
The Indian Chemical Council (ICC) has requested the Department of Revenue in the Ministry of Finance to exempt levy of service tax on membership fees and other charges collected by clubs or associations representing any trade or industry.
The Indian Chemical Council (ICC) has requested the Department of Revenue in the Ministry of Finance to exempt levy of service tax on membership fees and other charges collected by clubs or associations representing any trade or industry.
In a letter to the Department of Revenue, ICC said that a suitable notification should be issued to exempt the levy for the period April 1, 2008 to March 31, 2011 under section 11C of the Central Excise Act, 1944 as made applicable to service tax vide section 83 of the Act or by suitably amending section 96J of the Finance Act, 1994.
The ICC also requested the department to issue appropriate directions/instructions to the field formations not to take any action in the meantime.
According to the ICC, the taxable category of 'club or association service' was introduced in the Finance Act, 1994 w.e.f. June 16, 2005. It may be mentioned that ICC actually qualified to be excluded from the definition of the above taxable service being an organisation with an objective in the nature of public service and charitable nature.
Though the Ministry of Finance provided a special exemption from the levy of service tax on the membership fees collected by club or association formed for representing the industry or commerce, during the period June 16, 2005 to March 31, 2008, there is not such notification for the intervening period of three financial years - April 1, 2008 to March 31, 2011, it said.
"For the intervening period, various chambers of commerce and other associations including ICC have been under a constant stress and anxiety caused on account of notices issued and inquiries commenced by service tax or Central excise authorities for recovering service tax," it said.
The ICC also said that it has not "collect the service tax from the members association for the intervening period on account of the ambiguity involved regarding the leviability of service tax on membership fees and other charges collected from the members and non-members. This practice has also been adopted by all chambers of commerce or other associations".
The ICC submitted that in the light of the above facts and backdrop, it is not a profit organisation but id supported by the Ministry of Chemicals and Petrochemicals for providing services for the promotion of the Indian chemical industry.
"We therefore seek your intervention to issue an appropriate notification, instruction and clarifications to the authorities and departments concerned to safeguard the interests of ICC and other chambers of commerce and associations in a larger sense," it wrote in its letter to the Department of Revenue.
First Published : June 25, 2012 12:00 am