Religious body renting immovable property is outside taxable service, so the service tax demand and penalty could not survive.

Renting of immovable property by a religious body falls within the statutory exclusion from taxable service under the Finance Act, 1994. Applying Section 65(105)(zzzz) with the exclusion for religious bodies in Section 65(90a), the demand for service tax on rent received could not be sustained. The impugned demand and penalty therefore did not survive, and the appellant was not liable to pay service tax on the rent received.

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Issues: Whether service tax is payable on rent received by a religious body for letting out its premises under the service tax provisions governing renting of immovable property.

Analysis: The appellant was found to be a religious body. The statutory definition of taxable service under Section 65(105)(zzzz) of the Finance Act, 1994, read with the exclusion in Section 65(90a) of the Finance Act, 1994, exempted renting of immovable property by a religious body. In view of the statutory exclusion and the supporting precedent relied upon, the demand could not be sustained.

Conclusion: The appellant was held not liable to pay service tax on the rent received, and the demand was set aside in favour of the appellant.

Final Conclusion: The impugned demand and penalty did not survive, and the appellant obtained full relief on the taxability issue.

Ratio Decidendi: Renting of immovable property by a religious body falls within the statutory exclusion from taxable service and is not subject to service tax.

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