"I have spoken with the Finance Minister P Chidambaram, on whether chambers are liable to pay tax. To this, he said very clearly, that chambers are non-profit making entities", secretary general of the Federation of Indian Chambers of Commerce and Industry (FICCI) Amit Mitra told PTI.

The Central Board of Excise and Customs (CBEC) has served a show cause notice demanding Rs 33 crore (Rs 330 million) as service tax from the Confederation of Indian Industry (CII). From Ficci and other chambers it has sought details on membership fee.

Mitra said he has also spoken to top brass of CII, who have informed him that they have also taken up the issue with the Finance Minister.

Asked why business chambers should not pay service tax, Mitra said FICCI is registered under the Section 25 of the Companies Act and was not liable to pay tax. An entity

registered under Section 25 of the Companies Act is treated as a non-profit organisation and is free from the tax liabilities.

Mitra said Ficci works not only for industry but also for the larger national interest. "Our primary work is for policy change...this is not for the industry (alone). Ficci had worked earlier for national independence. There was no money made in that", he said. In the post-91 era, the chamber worked for liberalisation of the economy, he said.