Race Track is “Road” but without Access to Public: CESTAT denies Service Tax Exemption on Construction of Race Track

The Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) ruled that a race track is a road but not a public one, thus denying service tax exemption on its construction. The case involved M/s MARG Ltd, which constructed the Irungattukottai race track for M/s Madras Motor Sports Club, claiming exemption under Section 65(25b) of the Finance Act, 1994, meant for roads. CESTAT clarified that the exemption applies only to roads accessible to the public. Since the race track is not open to the public, it does not qualify for the exemption. The Tribunal dismissed the appeal, emphasizing that access to the general public is a crucial criterion for claiming the said tax exemption.