The Supreme Court on Friday decided to examine whether the services rendered by the Tirumala Tirupati Devasthanams to pilgrims, including accommodation and sevas, would come within the purview of service tax.
Issuing notice on a writ petition filed by the TTD, a Bench of Justices A.K. Patnaik and Ibrahim Kalifulla restrained authorities from taking coercive steps to recover from it service tax, said to be more than Rs. 6 crore.
The former Attorney-General and senior counsel, K. Parasaran, submitted that the Centre’s move violated fundamental rights to practise one’s religion. Besides service tax on accommodation, demands were being made even on various sevas, he said.
The petition sought quashing of the provisions of the Finance Act on levy of service tax as violative of Articles 26 (freedom to manage religious affairs), 27 (freedom as to payment of taxes for promotion of any particular religion), and 14 (right to equality). Notice was also issued, returnable in two weeks, on a plea for an interim stay.
The TTD challenged the constitutional validity of Sections 65 (105) and 66 B of the Act, which impose service tax on facilities, saying these were incidental and integral to provision of basic amenities to pilgrims. “The incomes generated from rent/lease/licence fees... are all used for maintenance of the premises and for developing more and better facilities. There are no private holdings at Tirumala, and even in Tirupati, amenities are provided near all major temples, and choultries/rest houses are offered to pilgrims at very reasonable rates.”
The petition said the TTD was not engaged in any commercial activity and was merely performing duties as mandated under the Andhra Pradesh Charitable and Hindu Religious Institutions and Endowments Act, 1987.