Published on: April 21, 11:28 IST
Supreme Court upheld an appellate tribunal’s decision, affirming that the Patanjali Yogpeeth Trust is liable to pay service tax for organizing Yoga camps. The ruling, delivered by a bench comprising Justices Abhay S Oka and Ujjal Bhuyan, declined to intervene in the appellate tribunal’s judgment issued on October 5, 2023.
The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Allahabad bench, previously determined that the Yoga camps conducted by the Patanjali Yogpeeth Trust, which levies fees for participation, fall within the realm of “health and fitness service” and are subject to service tax.
The bench, while dismissing the Trust’s appeal said, “The tribunal has rightly held that Yoga in camps for a fee is a service. We do not find any reason to interfere with the impugned order. The appeal is dismissed.” In its order, the CESTAT had held that Yoga camps organised by Patanjali Yogpeeth Trust, which charges fees for participation, come under the category of “health and fitness service” and attract service tax.
The tribunal emphasized that the fees collected from participants, although termed as donations, constituted consideration for the services rendered. It pointed out that the Trust, associated with Yoga guru Ramdev and Acharya Balkrishna, primarily offers Yoga training at various residential and non-residential camps.
Challenging the service tax demand of approximately ₹ 4.5 crore spanning from October 2006 to March 2011, the Trust argued that its services aimed at curing ailments and thus did not qualify as taxable under “health and fitness service.” However, the appellate tribunal found no substantial evidence supporting this claim, asserting that the services provided by the Trust resembled those of a health club or fitness center.
Furthermore, the tribunal highlighted the Trust’s practice of collecting entry fees under the guise of donations, issuing tickets of varying denominations to participants. These tickets granted different privileges, including access to instruction sessions led by Swami Baba Ramdev on Yoga and Meditation.
The appellate tribunal’s decision underscores the importance of clarity in defining taxable services and preventing attempts to circumvent tax obligations. The Supreme Court’s dismissal of the Trust’s appeal solidifies the obligation to comply with taxation laws, reinforcing accountability within organizations offering specialized services.
