Tribunal grants appeal, overturns service tax demands on car parking, club membership, and construction services.

The Tribunal allowed the appeal, setting aside the demands for service tax on car parking charges, club membership services, and advance received for construction services, both on merits and on limitation grounds. The order of the lower authority was modified accordingly, and the appellant was granted consequential relief as per law.

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Issues Involved:
1. Demand of Service Tax on car parking charges.
2. Demand of Service Tax on 'Membership of Club or Association Services'.
3. Demand of Service Tax on advance received for construction services provided before the service became taxable.

Issue-Wise Detailed Analysis:

1. Demand of Service Tax on Car Parking Charges:
The appellant contended that the car parking charges collected from buyers were for the right to use the car parking space and not for construction services. The appellant presented agreements and registered deeds to support this claim. The appellant also argued that car parking was specifically excluded from the definition of 'Preferential Location Services'. The Tribunal found that the appellant provided the right to use car parking space and not construction services. The Tribunal cited the case of Friends Land Developers Vs Commissioner of Central Excise And Service Tax, Ghaziabad, where the demand was dropped on the grounds of limitation due to the ambiguity in the taxability of such services introduced w.e.f. 01/07/2010. Consequently, the Tribunal set aside the demand on the grounds of limitation, acknowledging the appellant's bona fide belief that no tax was payable under 'Construction Services'.

2. Demand of Service Tax on 'Membership of Club or Association Services':
The appellant argued that the amounts collected were deposits towards club construction and not subscription fees for club services, and the club was not operational during the disputed period (April 2008 to June 2010). The Tribunal accepted the architect’s certificate confirming the non-existence of the club during the disputed period. The Tribunal also referenced the Supreme Court's judgment in State of West Bengal Vs Calcutta Club Ltd., which established that no service tax could be levied on services between a club and its members. Thus, the Tribunal set aside the demand under 'Membership of Club or Association Services'.

3. Demand of Service Tax on Advance Received for Construction Services:
The appellant contended that the demand for service tax on amounts received post 01/07/2010 for services rendered up to 30/06/2010 was incorrect, as the services were provided before they became taxable. The Tribunal referred to Rule 6(1) of the Service Tax Rules, which states that no service tax shall be payable for services provided during a period when such services were not taxable. The Tribunal also cited the case of Amit Metaliks Ltd., which held that the taxable event is the rendition of service, not the receipt of payment. Consequently, the Tribunal set aside the demand for service tax on 'Construction of Residential Complex Services'.

Limitation:
The Tribunal found that the department failed to provide sufficient evidence to justify the invocation of the extended period of limitation. The Tribunal concluded that the entire demand could not be confirmed both on merits and on limitation.

Conclusion:
The Tribunal allowed the appeal, setting aside the demands for service tax on car parking charges, club membership services, and advance received for construction services, both on merits and on limitation grounds. The order of the lower authority was modified accordingly, and the appellant was granted consequential relief as per law.

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