2015 (4) TMI 497

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....ing a demand of service tax and penalty on the petitioner, which is a department of the State Government. The main ground of challenge against Ext.P7 order of the 2nd respondent, is with regard to the jurisdiction of the 2nd respondent to pass the said order. It is pointed out that, the petitioner, being a department of the State Government, cannot be subjected to the levy of service tax in as much as the services rendered by it are in the course of discharging sovereign functions and hence, the concept of a taxable service, for the levy of service tax, does not arise in the transactions between the petitioner and its clients. It is contended that leasing of property is a subject contemplated within Entry 35, read with Entry 18 of List II o....

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....of the respondents to subject the activities of the petitioners to tax under the Finance Act, 1994, is called in question, in the present writ petition. 2. I have heard the learned counsel for the petitioners and the learned Standing counsel for the respondents. 3. On a consideration of the facts and circumstances of the case as also the submissions made across the bar, I find that in Ext.P7 order, the levy of service tax, that was confirmed on the petitioners, was a tax on "renting of immovable property services" which, according to the respondents, was rendered by the petitioners in terms of Exts.P1 and P1(a) executive orders. Although, it is the contention of the petitioner that, by virtue of Entry 35 read with Entry 18 List II of the ....

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.... confirming a demand of service tax on the petitioner in respect of the services rendered by the petitioner pursuant to Exts.P1 and P1(a) orders. Counsel for the petitioner would point out that, by virtue of the provisions of Section 66 B, the services rendered by the petitioner would fall under the negative list of services under the Finance Act, 1994 as amended. I note that, this aspect was not urged by the petitioner before the 2nd respondent in the proceedings that led to Ext.P7 order. At any rate, it is open to the petitioner to raise the said point in an appeal which the petitioner is entitled to file against Ext.P7 order before the CESTAT. Thus, I relegate the petitioner to the alternate remedy of filing an appeal, against Ext.P7 or....