No Service Tax on BCCI Subsidies to Cricket Association of Bengal: CESTAT

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Kolkata Bench has set aside a service tax demand of over ₹33.54 crore raised against the Cricket Association of Bengal (CAB), holding that subsidies and grants received from the Board of Control for Cricket in India (BCCI) for promotion of cricket are not consideration for taxable services. The bench of Ashok Jindal (Judicial Member) and K. Anpazhakan (Technical Member) has observed that the activities carried out by CAB were essentially connected with the promotion of the sport of cricket. It noted that all services provided by the association were naturally bundled with the main objective of promoting sporting events. The Cricket Association of Bengal, a society registered under the West Bengal Societies Registration Act and a full member of BCCI, primarily organizes cricket matches and maintains cricketing infrastructure. Its activities are largely funded through grants and subsidies from BCCI. The department issued a show cause notice demanding service tax of ₹33.54 crore for the period April 2010 to March 2015. The demand was confirmed in the adjudication order along with interest, while penalties were imposed on part of the amount. The department alleged that CAB had provided various taxable services such as event management services, renting of immovable property, club or association services and business support services, and had also failed to discharge tax liability under the reverse charge mechanism. Aggrieved by the confirmation of demand, CAB filed an appeal before the Tribunal. The Revenue also filed a separate appeal challenging the quantification of tax and the decision not to impose penalties on certain amounts already paid. Under the service tax regime, services relating to the promotion of sporting events were exempt from tax prior to June 30, 2012, under Notification No. 30/2010-ST. Subsequently, the Mega Exemption Notification No. 25/2012-ST also exempted such services. The Tribunal emphasized that subsidies received from BCCI were grants-in-aid intended to support the development of cricket infrastructure and organization of matches, and not payments made in return for any identifiable service rendered by CAB to BCCI. Relying on its earlier decision in the case of the Jharkhand State Cricket Association, the bench held that subsidies such as IPL subvention and television/media rights subsidy are grants meant for promotion of cricket and cannot be treated as consideration for taxable services. The Tribunal also rejected the department’s contention that CAB had provided “event management services.” It noted that event management services require a commercial arrangement where an event manager organizes or promotes an event for a client in return for consideration. In the present case, CAB was hosting cricket matches in its own capacity as a member association of BCCI and not as an event manager engaged by BCCI. Therefore, the basic requirement of a client-service provider relationship was absent. The bench further applied the doctrine of mutuality, noting that BCCI is an association consisting of its member cricket associations. Funds distributed among members cannot be treated as consideration for services because an association cannot render services to itself. The Tribunal relied on the Supreme Court’s ruling in State of West Bengal v. Calcutta Club Ltd., which affirmed that transactions between clubs or associations and their members are governed by the principle of mutuality and do not constitute taxable services. The Tribunal also overturned the denial of CENVAT credit amounting to ₹27.04 lakh on the ground of absence of supporting documents. It held that there was no allegation that the credit pertained to ineligible input services and therefore it could not be disallowed merely for lack of documentation. Similarly, CENVAT credit of ₹8.14 lakh on rent-a-cab services was allowed after the Tribunal found that the vehicles were used for transporting players, match officials and staff during cricket events, which was directly connected with CAB’s core activities. The Tribunal further observed that CAB had been regularly filing statutory returns and disclosing relevant details to the department. Since the demand was based on the association’s own books of accounts, there was no suppression of facts. Consequently, invocation of the extended period of limitation was held to be unsustainable. Case Details Case Title: The Commissioner of CGST & C. Ex., Kolkata Versus M/s. The Cricket Association of Bengal Citation: JURISHOUR-354-CES-2026(KOL) Case No.: Service Tax Appeal No. 75455 of 2017 Date: 12.03.2026 Counsel For Appellant: Deepak Suneja, Chartered Accountant Counsel For Respondent: Prasenjit Das, Authorized Representative Click Here To Read Order Read More: GST Fraud Accused Allowed to Travel Abroad: Bombay HC

No Service Tax on BCCI Subsidies to Cricket Association of Bengal: CESTAT

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