Supreme Court restrains Andhra Pradesh government from collecting service tax from Tirupati Temple

NEW DELHI: The Supreme Court on Friday restrained the government from collecting service tax from the Tirupati Balaji temple in Andhra Pradesh for accommodation provided to pilgrims.

The government had introduced a 12 per cent tax with effect from May 1, 2011 on all short-stay accommodation for which Rs 1,000 per day is charged. The Tirumala Tirupati Devasthanams board was later given a 50 per cent exemption as it was a religious institution.

The government issued a notice to the temple management on May 25, 2011, asking it to obtain service tax registration, and later ordered it to pay outstanding tax with interest and penalty. The management approached the top court after losing its plea in the Andhra Pradesh High Court against the tax demand.

A Supreme Court bench headed by Justice AK Patnaik issued a notice to the finance ministry on the temple management’s plea seeking interim relief against the tax demand. The court also prevented tax authorities from taking steps to recover tax arrears until further orders.