Bad news for cricket fans!

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The AAR also ruled that K P H Dream Cricket would be eligible to claim input tax credit (ITC) on taxes paid for such complimentary tickets only to the extent of input and input service for such tickets. The AAR said when the applicant issues a ‘complimentary ticket’ to any person, the applicant is “certainly displaying an act of forbearance by tolerating persons who are receiving the services provided by the applicant without paying any money, which other persons not receiving such complimentary tickets would have to pay for”.

Stating that the complimentary tickets given by K P H Dream Cricket to various persons would certainly be covered by the term ‘token’ and ‘voucher’, the AAR said as per GST laws the monetary value of “forbearance would naturally be pegged to the amount of money charged from other persons not receiving the ‘complimentary tickets’ for availing the same services.”

“The applicant has clearly missed the import of clause (b) in the definition of ‘Consideration’ given in section 2(31) of the CGST Act, 2017 which certainly covers the activity of the applicant of giving ‘complimentary tickets’ to certain persons in the furtherance of his business and would thus be covered under scope of supply defined in Section 7(1)(a) of the CGST Act, 2017,” the AAR said.

Commenting on the order, EY Tax Partner Abhishek Jain said: “A levy of GST on the free supply of services to unrelated parties is not envisaged under the GST law. The ruling is against the no GST position adopted by the industry on such transactions”.



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