Appeal partly allowed on service tax for Club, Restaurant, and Property Rent services. Penalties waived in specific cases.

The appeal was partly allowed in the case involving service tax on Club or Association Services, Restaurant Service, and Renting of Immovable Property. The demand for Club and Association Services until 30.06.2012 was set aside, while the demand for Renting of Immovable Property Services was upheld. The issue of Restaurant Service tax liability was sent for fresh adjudication. Penalties under Section 78 of the Act were set aside due to reasonable causes for non-payment in specific instances.

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Issues:
1. Demand of service tax on Club or Association Services, Restaurant Service, and Renting of Immovable Property Service.
2. Applicability of penalties under Section 78 of the Act.
3. Fresh adjudication required for Restaurant Service tax liability.

Analysis:
1. Demand of Service Tax on Club or Association Services, Restaurant Service, and Renting of Immovable Property Service:
The case involved M/s. Tuticorin Gymkhana Club providing recreational services under "Club or Association Services" to its members, along with a restaurant facility and leasing out a part of their premises. The Revenue issued a Show Cause Notice for non-payment of service tax under various categories. The Order-in-Original confirmed the demand, interest, and penalties except under Section 78 of the Act. The appellant appealed, arguing against the demand. The Tribunal referred to previous judgments and held that demand for Club and Association Services up to 30.06.2012 was not sustainable. However, for Renting of Immovable Property Services, the demand was upheld. Regarding Restaurant Service, the Tribunal set aside the issue for fresh adjudication based on the appellant's explanation and financial documents.

2. Applicability of Penalties under Section 78 of the Act:
The Tribunal noted that the issue of taxability under Club and Association Services was resolved by previous High Court decisions. For Renting of Immovable Property Services, the appellant's mistaken assumption led to non-payment of tax, justifying the setting aside of penalties. Similarly, as there was no short payment on Restaurant Service due to the appellant's explanation, penalties were deemed unjustified and set aside.

3. Fresh Adjudication Required for Restaurant Service Tax Liability:
The appellant claimed no shortfall in Restaurant Service tax payment, attributing any differences to changes in abatement rates. The Tribunal found the explanation plausible and set aside the issue for fresh adjudication by the adjudicating authority. The appellant's income and expenditure statement and other relevant documents were to be considered for a new adjudication order.

In conclusion, the appeal was partly allowed, with the demand on Club and Association Services being set aside, Renting of Immovable Property Services demand upheld, and the Restaurant Service issue sent for fresh adjudication. Penalties were set aside due to reasonable cause for non-payment in certain instances.

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