Sports Club of Gujarat Faces Member Backlash Over Unpaid Service Tax Refunds

Reluctance of club members to pay service tax refund to thousands of sports club members

Club Members Threaten Agitation Over Delayed Service Tax Refunds at Sports Club of Gujarat

• Supreme Court Ruling Ignored: Despite the Supreme Court’s 2019 ruling exempting clubs from service tax, the Sports Club of Gujarat has failed to refund the tax to its members, leading to widespread frustration.
• Refunds Delayed: Out of Rs. 5.47 crore owed to 2,511 members, only Rs. 75.62 lakh has been refunded to 243 members as of May 20, 2024, with no clear timeline for the remaining refunds.
• Members Demand Action: The Club Members’ Protection Committee, led by Rajesh Brahmabhat, warns of mass agitation if the club management does not provide a satisfactory response and expedite the refund process for approximately Rs. 10 crore.

BILKULONLINE

Ahmedabad, May 30: Sports Club of Gujarat in Navrangpura area of ​​Ahmedabad has come under fire from the members of the club due to the threatening behavior and arbitrary behavior of its management.

The club is not required to pay service tax on the charges collected from its members. Even the Supreme Court’s judgment is being ignored by the management of the sports club. Thousands of members are yet to receive the refund of the service tax they paid. And if the club does not clarify when this payment will be received, the members have warned of mass agitation.

Regarding this, Rajesh Brahmabhat of the Club Members’ Protection Committee said, “I am a member of the Sports Club of Gujarat for the last seven years. And I have made several representations to the management of the club regarding getting refund of service tax. However, there is no clear or satisfactory answer from the management and instead they are acting arrogantly. According to the club, between 2005 and July 2017, 2,511 members paid service tax on entry fees and are eligible for refund. The total amount of which is around Rs. 5 crores is equal to 47 lakhs.

However, among these, till May 20, 2024, only 243 members received Rs. 75.62 lakh has been paid. The management is not clarifying when the refund will be paid to the remaining members. About 8500 members of sports club should be paid service tax of Rs. He further said, we rest of the club members have made several representations to the club which fell on deaf ears. If a clear and satisfactory answer is not given from the club management regarding the refund of the arrears, then in the near future we will be forced to present at a higher level and launch a vigorous agitation.

It is worth mentioning that the Supreme Court’s 2019 State of West Bengal Vs. In the case of Calcutta Club Limited (2017) 5, SCC 356, it was held that the club and its members are not separate entities and therefore the services provided by the club to its members are not covered by the provision of services.

In addition, Rajesh Brahmabhat says that the 8500 members of the sports club are respectfully demanding that around 10 crore rupees of service tax received from the government should be received at the earliest.

Club Members Demand Service Tax Refund: Mass Agitation Threatened

Thousands of members are still awaiting refunds for the service tax they paid. Rajesh Brahmabhat of the Club Members’ Protection Committee has voiced his frustration, stating, “I have been a member of the Sports Club of Gujarat for the last seven years and have repeatedly requested the refund of service tax. The management has not provided a clear or satisfactory response and continues to act arrogantly.”

The issue stems from service tax collected between 2005 and July 2017. According to Brahmabhat, 2,511 members paid service tax on entry fees, totaling around Rs. 5.47 crore. However, as of May 20, 2024, only 243 members have received refunds amounting to Rs. 75.62 lakh. The management has not specified when the remaining refunds will be issued.

The Supreme Court’s 2019 ruling in the case of State of West Bengal vs. Calcutta Club Limited (2017) 5, SCC 356 stated that clubs and their members are not separate entities, exempting such services from service tax. Despite this, the Sports Club of Gujarat has yet to comply fully with the ruling.

Brahmabhat stressed that the 8,500 members of the club are respectfully demanding the refund of approximately Rs. 10 crore. “If a clear and satisfactory response is not provided soon, we will be forced to escalate our efforts and initiate a vigorous agitation,” he warned.

The members are urging the club management to expedite the refund process and adhere to the Supreme Court’s ruling to avoid further conflict.