Horticulture & Landscaping Not Taxable under Service Tax Law

The Appellate Tribunal CESTAT, New Delhi, upheld the Commissioner (Appeals) order, ruling that activities related to the maintenance of green belt and garden are not subject to service tax under the Finance Act, 1994. The Tribunal found that the respondents' horticulture and landscaping activities did not constitute maintenance of immovable property as defined by the Act, leading to the rejection of the Revenue's appeal.

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The Appellate Tribunal CESTAT, New Delhi, consisting of P.K. Das and M. Veeraiyan, members, heard an appeal filed by the Revenue against an order by the Commissioner (Appeals) that activities related to the maintenance of green belt and garden are not subject to service tax under the Finance Act, 1994. The dispute centered around whether the maintenance activities performed by the respondents fell within the definition of "maintenance of immovable property" as per section 65(64) of the Act. The Revenue argued that the activities carried out by the respondents were taxable services as per a Board's Circular and the amended definition of "maintenance and repair" from 16-6-2005. The respondents contended that their activities focused on horticulture and landscaping, which did not constitute maintenance of immovable property. The Tribunal examined the scope of work outlined in the contract and found that the respondents were primarily engaged in horticulture activities such as growing plants, trees, and grass, which were not considered maintenance of immovable property. The Commissioner (Appeals) had correctly ruled that no tax was due on such activities during the relevant period. Consequently, the Tribunal rejected the Revenue's appeal and upheld the Commissioner's order.

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