01 五月 2024

Access to a bowling alley – Service other than fun/recreation in any part of such facility is not material for coverage under Negative list

The CESTAT New Delhi has set aside the order which had disallowed the assessee from being covered under the scope of Section 66D(j) of the Finance Act, 1994 (Negative List – Admission to entertainment events or access to amusement facilities), as the assessee provided services other than bowling alley activity also at the centre.

Holding that the provision of access to a bowling alley would be covered under the Negative List, the Tribunal observed that the definition of ‘amusement facility’ does not disqualify a facility from being covered under its scope only because services other than fun or recreation are provided in any part or place of such facility.

According to the Tribunal, the definition only excludes other places from scope of amusement facility, meaning that the charges for access to such places would be taxable. The Tribunal in this regard noted that the assessee had earmarked places for fun and recreation where no other services were provided.

Similarly, the Department’s contention that the amount charged for ‘playing bowling’ would not be covered in the Negative List, was also rejected by the Tribunal, while it observed that in a bowling arcade amount was charged for entering the bowling premises and once the entry was paid, the customer was free to bowl in the available alley.

It was also noted that the assessee had not collected charges for ‘playing bowling alley’, and that ‘access to’ an amusement facility would also mean the permission to use such facility. The period involved in Smaaash Leisure Ltd. v. Commissioner was from 1 July 2012 to 31 January 2017.

Assessee in this case was represented by Lakshmikumaran & Sridharan.

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