Amitava Lala, J. - (1.) This writ petition has been made by the Saturday Club Limited, a well-known club of the city of Calcutta (Kolkata) by the pen of the then Secretary and authorized representative of the same. Such writ petition was filed in the year, 1998 praying inter alia declaration that the petitioner club is not a mandap keeper within the meaning of Chapter V of the Finance Act, 1994 as amended by the Finance Act, 1997 and is not liable to pay any service tax under the Act along with various writs in the nature of mandamus, prohibition, certiorari with the incidental prayers virtually to restrain the authorities from giving effect and/or further effect of all the purported proceedings relating and/or including the communications dated 21" October, 1997, 17th December, 1997, 23rdApril, 1998, 8th July, 1998 and 17th/ 21st July, 1998 and a direction upon the respondents to act in accordance with law. Such writ petition was then formally entertained and interim order was granted by a Bench of this High Court. Directions for affidavits were also given.
(2.) Mr. R. N. Bajoria, learned Senior Counsel, with the able assistance of Mr. J. P. Khaitan, learned Counsel, contended before this Court that the petitioner club is a members' club but not a proprietary club. Therefore, it is not supposed to pay service tax for using the space as mandap as per requirement of the members. It is governed by its own Memorandum and Articles of Association as well as rules and bye-laws connected therewith. From the relevant clause under objects being clause 3(a) of the Memorandum and Articles of Association is quoted hereunder : "3(a) To afford to its members all the usual privileges, advantages, conveniences and accommodation of a Club and the promotion of social amusement and entertainments, the pursuit of literature and the facilitation of study in languages and the arts".
(3.) The question of profit would also govern by clause 86 of the Articles of Association under Chapter V which deals with financial part of it. Such portion is also quoted hereunder : "The profits of the Club whencesoever derived, shall be applied solely towards the benefit of the Club or otherwise in the promotion of the objects of the Club as set forth in the Memorandum of Association, and no portion thereof shall be paid by way of dividend or bonus to the Members of the Club".;