TaxTMI 
TaxTMI 
TaxTMI 
2014 (9) TMI 697
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....authority has confirmed a service tax demand of Rs. 5,36,31,86,244/- alongwith interest thereon by classifying the service rendered by the appellant M/s Maharashtra Industrial Development Corporation (MIDC for short) under the category of "Renting of Immovable Property" for the period 1.6.2007 to 31.3.2012. He has also imposed a penalty of equal amount, apart from a penalty of Rs. 10,000/- under Section 77 of the Finance Act, 1994. Aggrieved of the same the appellant is before us. 2. The learned Chartered Accountant representing the appellant submits that M/s MIDC has been created under the Maharashtra Industrial Development Act, 1961 and from the preamble of the Act it may be seen that the Corporation has been set up to make a special pro....
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....n the nature of a sovereign function. The ratio of the said decision would apply to the appellant's case also and therefore the activity of leasing of land by the corporation has to be held as sovereign function and therefore not amenable to taxation. The learned consultant also relies on the decision of the Tribunal in the case of Electrical Inspectorate, Government of Karnataka vs CST (2008) 9 STR 494 (Tr-Bang) wherein a question arose whether the inspection and certification of electrical installation undertaken by the Electrical Inspectorate of the Government of Karnataka would be amenable to service tax under the category of technical testing and certification and analysis service and this Tribunal held that since it is a statutory....
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....ected pre-deposit of the service tax demanded for the normal period. The ratio of the said decision would apply to the facts of the present case also. It is his contention that since appellant had undertaken the activity of renting of immovable property, service tax is liable to be paid from 1.6.2007 onwards and therefore, the appellant should be put to terms. 7. We have considered the submissions made by both the sides. 8. A perusal of Section 3(2) of the MIDC Act, 1961 makes it abundantly clear that MIDC is a body corporate with perpetual succession and a common seal, and may sue and be sued in its corporate name and shall be competent to acquire, hold and dispose of property, both movable and immovable, and to contract and do all thing....
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.... credited to / expended from the consolidated fund of the State. In the present case none of these conditions get satisfied and therefore, we are of the prima facie view that the functions undertaken by the Corporation are not sovereign functions. 9. As regards the reliance placed by the appellant in the Hon'ble apex court's decision in the case of Haryana State Industrial Development Corporation vs Hari Om Enterprises, the dispute therein pertained to acquisition of land from the private citizens. The said decision is nowhere related/connected to leasing of land and it was in that context, it was held that the acquisition of land for the purpose of the industrial development of the State can be considered as a sovereign function. ....
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....ase rental. The facts involved are identical to the one considered by this Tribunal in the case of CIDCO Ltd (cited supra) and in the said case also the argument was raised whether the leasing of land on behalf of the State can be amenable to levy of service tax or not. This Tribunal considered and examined the issue at length in para 6.3 of the said order and came to the conclusion that the lease of land by Company owned by the State Government can be subject to indirect taxes including service tax after considering the decisions of the Apex Court in the Presidential reference in the context of section 20 of the Sea Customs Act [1964 (3) SCR 787] and A.P. Transport Corporation [1964 (52) ITR 524]. In the said decision, the Tribunal further....