Notices for non-payment of service tax

The indirect tax department has begun the process of sending show-cause notices to owners of IPL teams for non-payment of service tax.....

The indirect tax department has begun the process of sending show-cause notices to owners of IPL teams for non-payment of service tax. Sources told The Indian Express that notices have been sent to teams including the Vijay Mallaya-owned Royal Challengers,Deccan Chronicle-owned Deccan Chargers and Kings XI Punjab.

There are 19 services against which the franchisees are required to pay service tax including advertisement of space and time,business auxiliary service,consulting engineer service,manpower recruitment and supply services,tour operator services,sponsorship services and IPR services.

The sources said Royal Challengers Sports Pvt Ltd has been sent the notice for non-payment of Rs 2.5 crore for its business auxiliary service while Rs 3 crore due on sponsorship from United Breweries and United Spirits.

The Hyderabad commissionerate has sent notices to Deccan Chargers for Rs 18 crore due for franchisee service.

The service tax collected from IPL I and II totals around Rs 100 crore with Rs 67 crore in cash and Rs 25 crore in Cenvat.

Show-cause notice has also been issued on KPH Dreams,which owns Kings XI Punjab,seeking payment of Rs 5.38 crore service tax for IPL I. A demand of Rs 2.54 crore has also been raised on sponsoring firms. The commissionerate has also sought information from players like Yuvraj Singh,Uday Kaul,Sunny Sohal,V R V Singh and Rishi Dhawan. It has also asked for copy of agreements signed by players with their franchise owner,total payment received,service tax registration number if obtained by them,the sources said.

The Delhi commissionerate has asked players of Delhi Daredevils to furnish information about their service tax payments under business auxiliary services. Gautam Gambhir has furnished his reply,the source said.

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The BCCI,which earned Rs 240 crore from sale of media rights to WSG and Multi-Screen Media,which were searched on Wednesday by I-T officials,is due to pay Rs 25 crore service tax,an official source said.