SC Asks Ramdev's Patanjali Trust To Pay Rs 4.5 Cr Tax For Charging Entry Fees At Yoga Camps

The Supreme Court in a recent order upheld the CESTAT ruling and held that Ramdev's Patanjali Yogpeeth Trust is liable to pay Rs 4.95 crore to tax authorities for Yoga camps.

Patanjali had contended in court that it was providing services which are for curing ailments and thus they are not taxable under health and fitness service.

The Supreme Court in a recent order upheld the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) ruling and held that Ramdev's Patanjali Yogpeeth Trust is liable to pay Rs 4.5 crore to tax authorities for charging an entry fee for organising Yoga camps.

A bench of Justices Abhay S Oka and Ujjal Bhuyan refused to strike down the order passed by the Allahabad CESTAT bench against Yoga guru Ramdev and his aide Acharya Balkrishna run Patanjali Trust.

In October 2023, the tribunal ruled that Yoga camps organised by Patanjali Yogpeeth Trust took fees for participation from participants and thus fall under the category of health and fitness service and attract service tax. The ruling came after Ramdev appealed against the order by the Commissioner of Customs and Central Excise of Meerut, that raised the service tax demand of Rs 4.5 crore for the period between October, 2006 to March, 2011, with a penalty and interest, PTI reported.

It was found that the Patanjali Trust under Yoga guru Ramdev and his aide Acharya Balkrishna organised Yoga training at various residential and non-residential camps and took money in the form of donations from participants.

The CESTAT held that money was collected from the participants by way of donation for these camps and as entry fee. 

It was found that though this amount was collected as a donation, it was disguised fees for providing the said services and hence was liable to be taxed as service provided. The appellate tribunal found that the Patanjali Trust issued entry tickets of various denominations. And the holder of the ticket was granted different privileges depending on the denomination of the ticket.

Patanjali had contended in court that it was providing services which are for curing ailments and thus they are not taxable under health and fitness service. However, the court found that these claims were not supported by evidence.

The CESTAT ruling found Patanjali Trust was engaged in providing the services that fall under the taxable category of services provided by health club and fitness centre, as defined under Section 65 (52) of the Finance Act.

The tribunal further held that there was no positive evidence to support Patanjali Trust's claim that they provide treatment for specific ailments being suffered by the person in these camps. It was further noted that instructions on 'Yoga' and 'Meditation' in these camps are not imparted to any individual but to the mass gathering together. There are no individual prescriptions, or diagnosing and treating any specific ailment/complaint of any individual.