Renting of parking space by Railways , bus stations

[vasudevan unnikrishnan]

In the mega exemption  notification  no. 25/2012-ST dated 20/06/2012, the  entry  at sl. No.24 there under reads—

“ Services by way of vehicle parking to general public excluding leasing of space to an entity for providing such parking facility”.

The Railway  station,bus station etc provide such services.However,iIn   many of such  cases, the authorities may entrust the job of collection of the parking fees to an outside agency through an agreement that irrespective of actual collection, the agency shall pay a fixed monthly charges to   the authority. In the above situation, it can never be construed as a lease of the space for parking and thus exempted. However, whether the authority will be taxable for ‘renting of immovable  property” ?. Here the para  6.1.1 of the Education Guide states that the negative list specifies that renting of vacant land, with or without a structure incidental to its use, in relating to agriculture ‘ only. Thus it would appear that the vacant land  in public places owned by the Railways, state transport bus stations, etc, allowed to be used for parking  of vehicles  will all get covered under the taxable service of Renting of Immovable property.

Expert advice solicited.

AI Summary

Renting of immovable property clarified as taxable where permitting use of public parking, subject to specified negative list exemptions.
Permitting or granting access, occupation or use of public land or built spaces for vehicle parking at transport termini is captured by the declared service Renting of Immovable Property; arrangements where an outside agency collects fees but pays a fixed amount to the authority still amount to renting. Only properties falling within the specified negative-list exclusions or the limited statutory exemptions are outside the taxable ambit; otherwise permitting usage of such public property for parking is chargeable as renting.