Tribunal rules on charges for utilities: only commission counts, directs deposit to waive pre-deposit, compliance due 11/03/2015.

The Tribunal held that charges collected for electricity and water by the appellant cannot be considered as the value of services provided, only the commission received should be considered. The appellant was directed to deposit Rs. 10 lakhs for one issue and Rs. 5.35 lakhs for another to waive pre-deposit of the balance amount, with recovery stayed until compliance. Compliance verification was scheduled for 11/03/2015.

---

---

Issues:
1. Taxability of collecting electricity and water charges as a service.
2. Classification of the activity under 'management, maintenance or repair service' or Business Auxiliary Services (BAS).
3. Dispute regarding CENVAT credit on club membership and outdoor catering services.
4. Determination of taxable value for electricity and water charges.
5. Compliance and pre-deposit requirements.

Analysis:
Issue 1: The primary issue in this appeal pertains to the taxability of collecting electricity and water charges by the appellant as a service. The appellant, engaged in renting immovable property and providing services to tenants, collected these charges and retained 10% as consideration for services rendered. The Revenue contended that this activity falls under 'management, maintenance or repair service,' leading to a tax demand of approximately Rs. 1.40 crores. However, the appellant argued that it could be classified under Business Auxiliary Services (BAS). The Tribunal, after considering the submissions, held that the charges collected for electricity and water consumption cannot be considered as the value of services provided. Instead, only the commission received by the appellant should be considered. The appellant was directed to deposit Rs. 10 lakhs as a fair offer.

Issue 2: Another demand of Rs. 18.88 lakhs was confirmed against the appellant for denying CENVAT credit on club membership and outdoor catering services. The appellant acknowledged liability post-April 2011 due to changes in the definition of input service. They agreed to deposit around Rs. 5.34 lakhs. The Tribunal agreed with the appellant's stance post-April 2011 and directed them to deposit Rs. 5.35 lakhs for that period.

Issue 3: The Revenue argued that the total payment received by the appellant for electricity and water charges constituted the taxable value. However, the Tribunal disagreed, stating that only the commission received should be considered as the value of services provided. The Revenue left the matter of CENVAT credit to the Bench's discretion.

Issue 4: The Tribunal found the appellant's offer to deposit Rs. 10 lakhs and Rs. 5.35 lakhs for the respective demands as fair. They directed the appellant to make these deposits within eight weeks to waive the pre-deposit of the balance amount of tax, interest, and penalties, with recovery stayed until compliance. The case was scheduled for compliance verification on 11/03/2015.

---