Plea seeking exemption of clubs from VAT dismissed

A division bench comprising Justice S Manikumar and Justice Subramonium Prasad while dismissing the plea moved by Chennimalai Nanbargal Manamakil Nala Sangam in Erode, said, “Mere apprehension of the petitioner does not persuade us to go into vires of the Section 2(15) (IX) and explanation of 1 of Section 2(33) (VI) of Tamil Nadu Value Added Tax Act, 2006, which stands repealed. This exercise at this juncture would be only academic in nature. If action is taken against the petitioner, it is open to them to take appropriate steps in accordance with law.”

The petitioner had submitted that the object of the club is to look after the welfare of the members by organising various indoor and outdoor games and providing refreshment to members. The club also provides liquor to its members and for this purpose, they had got a valid license from the Commissioner of Prohibition and ExciseDepartment.

Hence, the club does not fall within the definition of dealer under Section 2(15)(IX) of the TNVAT 2006, as there is no sale of goods in the form of food, refreshment and drinks by it to its members, the plea said.