Page 110 - GSTL_16 April 2020_Vol 35_Part 3

324 GST LAW TIMES [ Vol. 35
(a) Appellant reiterates the submissions made on Pages 7 to 12 of the
Appeal Memo.
(b) Further, the issue of taxability of Contributions/Collections re-
ceived by Club from its Members is squarely covered under the Re-
cent Supreme Court Judgment in the case of Calcutta Club Lim-
ited/Ranchi Club Limited.
(c) Views of Honourable Supreme Court on applicability of Sales Tax :-
• The Supreme Court referred to the sixty-first Law Commis-
sion Report, which made recommendations on the forty-sixth
amendment to the Constitution. It expressed that the Consti-
tution was not specifically amended to bring clubs within the
tax net. It relied on the three reasons in this report, viz. (a) the
number of such clubs and associations would not be very
large; (b) taxation of such transactions might discourage the
cooperative movement; and (c) no serious question of evasion
of tax arises, as a member of such clubs consumes his own
goods.
• The Statement of Objects and Reasons for the forty-sixth
amendment to the Constitution observed that while sale by
registered club or other association of persons (the club or as-
sociation of persons having corporate status) to its members
is taxable, sales by an unincorporated club or association of
persons to its members is not taxable. This is because such
club or association, in law, has no separate existence from
that of its members.
• The Statement of Objects and Reasons for the forty-sixth
amendment to the Constitution observed that while sales by
a registered club to its members is taxable, sales by an unin-
corporated club to its members is not taxable. Therefore, as
the club or association has no separate existence from its
members, the forty-sixth amendment to the Constitution did
not overcome the decision in the Young Men’s Indian Associa-
tion and the doctrine of mutuality remains applicable even af-
ter the amendment.
• For the supply of goods by incorporated and unincorporated
associations or body of persons to its members, the require-
ment of consideration is not fulfilled, as in case of supply of
goods to self, there exists no consideration as per the provi-
sions of the Contract Act, 1872. The club is acting as an agent
of its members, with no element of transfer in the supply of
food by it to the members. Hence, there is no “seller” or
“buyer” relationship in the passing of consideration.
(d) Views of Honourable Supreme Court on applicability of Service Tax :
• Post- 1 July, 2012, the definition of “person” under Section
65B(37) of the Finance Act, 1994 was changed to include any
association of persons or body of individuals whether incor-
porated or not. However, the definition of “services” under
Section 65B(44) of the Finance Act, 1994 requires the provi-
sion of services by one person to another, and the doctrine of
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