The court held that police services are sovereign functions and exempt from service tax under the Finance Act, 1994, particularly prior to the amendment that included government within the definition of 'person'.

ORDER :

1. A common order is passed in these three writ petitions as the issue that arises for decision is the same across all the matters.

2. The prayer in W.P.No. 6280 of 2016 is for a Declaration that the activities of the petitioner rendered under the Tamil Nadu District Police Act, 1859, the Chennai Police Act, 1888 (formerly the Madras City Police Act, 1888) (referred to hereinafter as ‘enactments’/’relevant enactments’) and Government Orders issued by the State of Tamil Nadu, are outside the scope of Chapter V and VA of Finance Act, 1994 in terms of which Service tax is levied.

3. W.P.No. 6281 of 2016 challenges Order-in-Original dated 14.10.2015 passed by the Principal Commissioner of Service Tax – I, Chennai – 600 040 / third respondent, and W.P.No. 6282 of 2016 is for a mandamus directing the respondent no.1 to issue suitable instructions to the subordinate officers not to propose demand /or levy service tax on the petitioner for statutory services rendered under the provisions of the Tamil Nadu District Police Act, 1859, the Chennai Police Act, 1888 (formerly the Madras City Police Act, 1888) and the relevant Government Orders issued by the State of Tamil Nadu.

4. The prayer, in common, is for an exemption from the levy of tax under the provisions of the Finance Act, 1994 (Service Tax/Service Tax Act) in respect of the services rendered by the petitioner, the Greater Chennai Police Commissionerate in the exercise of its sovereign functions under the aforesaid enactments.

5. We have heard detailed submissions advanced by Mr.Anishkumar, for the petitioner and Mr.Mohana Murali, for the respondents.

6. Mr.Mohana Murali has filed memo dated 09.12.2025 seeking an amendment to the array of respondents in light of the introduction of the Goods and Services Tax Act, 2017 with effect from 01.07.2017. The memo states that post introduction of the Goods and Service Tax Act, 2017, R3 – R5 as originally arrayed have merged. Memo dated 09.12.2025 is ordered and the Registry is directed to make corresponding changes to the array of respondents.

7. The submissions of the petitioner are to the effect that the Order-in-Original dated 14.10.2015 is bad in law as there is no liability that could be fastened on the police authorities qua the provision of security/bundobast services to various entities, both State as well as private.

8. Learned counsel for petitioner would submit that the duties of the police authorities rendered in terms of the relevant enactments constitute sovereign functions. Under various Government Orders, the State has permitted the authorities to collect certain amounts from the service recipients.

9. These receipts are nothing but a reimbursement of the costs to be defrayed by the petitioner in respect of those police officials deputed to render the security services. Hence, and being a measure of reimbursement, there is no profit that is earned by the petitioner and the receipts would hence not fall within the ambit of the Service Tax Act. He relies in specific on G.O. No. 949 dated 06.11.2009.

10. Learned counsel for petitioner would also argue that there could be no liability fastened under the Service Tax Act as far as governmental agencies are concerned. In fact, the Commissionerate had approached the Secretary to Government, Ministry of Home Affairs, New Delhi, as early as on 11.10.2012 seeking an exemption from the levy of service tax. That petition is still pending.

11. He relies on the judgment of the Supreme Court in Commissioner v. Dy. Com