The question of GST applicability on police bandobast services arranged for private events has gained relevance, particularly in cases where entry fees are charged from the public.

While earlier judicial precedents under the service tax regime treated certain services rendered by police authorities as sovereign functions not liable to tax, the position under the GST framework requires a more nuanced and statutory interpretation.

Under GST, exemption for services provided by the Government is governed by Notification No. 12/2017-Central Tax (Rate). Entry No. 6 of the said notification exempts services provided by the Central Government, State Government, Union Territory, or local authority.

However, this exemption is not absolute. Clause (d) of the same entry clearly excludes “any service, other than services covered under entries (a) to (c), provided to business entities.” This exclusion plays a decisive role in determining taxability in cases involving police bandobast services.

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In cases where an event organizer—typically a company, firm, or commercial entity—requests police deployment for crowd control, security, and law-and-order management during an event conducted for consideration, the nature of the transaction undergoes a critical shift. While policing and maintenance of public order are undoubtedly sovereign functions, GST law distinguishes between duties performed by the Government in its sovereign capacity and services provided by the Government for a consideration at the request of a specific recipient.

The CGST Act, 2017 adopts a broad definition of “business” under Section 2(17), which includes activities undertaken by the Government as public authorities. This significantly alters the traditional understanding of sovereign functions in taxation. Further, Section 7 of the Act clarifies that only those Government activities which are specifically notified shall be treated as neither supply of goods nor supply of services. Notification No. 14/2017 provides such exclusion only in limited cases, such as functions entrusted to Panchayats, and does not extend to police bandobast services.

Therefore, merely classifying an activity as a sovereign function does not automatically take it outside the ambit of GST. The decisive factor is whether the activity constitutes a “supply” for consideration to a “business entity.” Where an event organizer formally requests police bandobast and pays charges for such deployment, the transaction assumes the character of a service provided by the Government to a business entity.

This position is further reinforced by Notification No. 13/2017-Central Tax (Rate), which mandates that services supplied by the Government to a business entity are taxable under the reverse charge mechanism (RCM), subject to specified exceptions. Police bandobast services do not fall within those exceptions. As a result, where such services are provided against consideration to a business entity, GST liability is triggered under RCM, and the recipient is required to discharge the tax.

The distinction becomes clearer when contrasted with situations where police deployment is undertaken suo motu by the State in discharge of its general law-and-order responsibilities. In such cases, there is no specific request, no contractual arrangement, and no identifiable consideration flowing from a particular entity. Such activities retain their character as sovereign functions performed in public interest and may fall outside the scope of GST. However, once the deployment is specifically requisitioned by a private organizer and linked to a fee, the transaction aligns with the definition of supply under GST law.

The nature of consideration also assumes significance. Charges collected by the police department for bandobast arrangements—whether termed as deployment fees, security charges, or administrative costs—indicate a direct nexus between the service provided and payment received. This strengthens the argument that the activity constitutes a taxable supply rather than a mere statutory function.

Accordingly, the prevailing GST position suggests that police bandobast services provided for paid public events, when arranged at the request of a business entity and against consideration, are not covered under the exemption provided in Entry No. 6 of Notification No. 12/2017. Instead, such services fall within the exclusion clause relating to services provided to business entities and become taxable under the reverse charge mechanism in terms of Notification No. 13/2017.

While the sovereign nature of policing functions remains undisputed, GST law prioritizes the nature of the transaction over the inherent character of the function. Where the Government provides a service to a business entity for consideration, even if rooted in sovereign responsibilities, the exemption is unlikely to apply. The key determinants remain the existence of a request, the presence of consideration, and the status of the recipient as a business entity.

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