In what could turn into a major issue in the political season, the department of central excise has pulled up the Bharatiya Janata Party (BJP) for non-payment of service tax on the money earned by sale of tickets during rallies by Narendra Modi.
The Ludhiana regional unit of Directorate General of Central Excise Intelligence (DGCEI) has issued a notice to the Chandigarh unit of the BJP seeking an answer on the matter.
Citing government rules, the DGCI has argued that the BJP has to pay tax on the tickets as political rallies don’t fall under the category of “amusement and entertainment”, which get tax rebates.
“Recently it was in news that Bhartiya Janta Party has collected amount by way of tickets for entry to the rally at different places in India where Mr. Narendra Modi had addressed the public at large,” reads the notice.
“As the entry tickets to the event were not for any admission to any entertainment event or access to amusement facilities (which are in the negative list) the same is taxable in the hands of the person collecting the amount of tickets. It appears that the BJP/Shri Narendra Modi has neither got registered under the Service tax nor paid tax on collection from tickets,” the notice says.
The notice, dated February 12, has sought a response from the BJP within ten days of receiving it. The BJP should intimate the details of amounts collected and service tax paid, if any, the notice reads.
Expectedly, the BJP has slammed the move. Party spokesperson Ravi Shankar Prasad said, “ The government of India is so very worried that it has become mentally bankrupt in its hatred for Narendra Modi,” adding that it is beyond comprehension why the Ludhiana unit of the excise department sent a notice to the Chandigarh office of the BJP when no rally was held there.