TaxTMI 
TaxTMI 
2017 (9) TMI 1071
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....C. No. DL/ST/AE/09/05/Pt./99 dated 01/01/2008 SCN C. No. DL-1/ST/R-II/SCN/API/5/08 dated 23/10/2008 SCN C. No. DL-1/ST/R-II/SCN/API/5/08 dated 21/10/2009 SCN C. No. DL-1/ST/R-II/SCN/API/4/10 dated 12/03/2010 Management consultancy service 1,73,93,040 84,66,083 48,43,530 44,56,803 Real estate agent service 2,14,79,405 70,92,944 50,68,806 42,23,836 Business auxiliary service 6,45,900 - - - Management, maintenance and repair service 6,38,098 3,30,472 1,65,123 1,65,123 Advertising service 7,49,964 - - - Total 4,09,06,407 1,58,89,499 1,00,77,459 88,45,762 2. These demand notices were adjudicated by a common impugned order. The Commissioner dropped demands under "management consultancy service", "real estate agency service" and "advertising service". A part of demand under the categories of management, maintenance and repair service and business auxiliary service totally amounting to Rs. 1,06,080/- has been confirmed by the Original Authority alongwith equal amount of penalty under Section 78 and further penalties under Section 77 of the Finance Act, 1994. Aggrieved by this order, the Revenue filed this appeal. The respondent also filed a cross objection....
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.... various case laws, before arriving at his conclusion. The grounds taken by the Revenue in the present appeal have not brought out any factual or legal infirmity in such finding. 5. Explaining the grounds of cross objection, the learned Counsel submitted that the Commissioner wrongly confirmed the demand on maintenance or repair charges received from owners of the flats/plots for maintenance of common areas. Management of entire building and common areas is a single composite activity and cannot be attributed to each flat or plot owner, separately. The confirmation of demand is also contested on the point of limitation. There is no intention to evade payment of duty on the same ground there can be no penalty imposed on the respondent. 6. We have heard both the sides and perused the appeal records. 7. The first point for decision is the correctness of findings recorded by the Commissioner in respect of tax liability of the respondent under the category of "management consultancy service" and "real estate agent service". We have carefully perused the findings recorded by the Original Authority and the objections raised by the Revenue. Admittedly, the respondent has expertise and e....
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....r the clients to use the 'know-how' in the manner they desired. The assessee had no control over the usage of the 'know-how'. 8. We are in agreement with the above observation of the Original Authority and his reliance placed on the decision of the Tribunal in Castrol Ltd. Vs. CCE, Raigad - 2007 (8) S.T.R. 254 (Tri. - Mumbai). As such, we find that there is no merit in the objection raised by the Revenue on the above findings of the Original Authority. It is clear that transfer of know-how by the respondent to the client does not amount to management or business consultant service, as seen from the terms of agreement in the present case. 9. The respondents were sought to be taxed under the category of "real estate agent's service" in terms of Section 65 (88) (89) of the Finance Act, 1994. The statutory provision of the tax entry are as below :- "Section 65 (88) and (89) of the Act, 1994, defines the "real estate agent" and "real estate consultant" as under: (88) "real estate agent" means a person who is engaged in rendering any service in relation to sale, purchase, leasing or renting, of real estate and includes a real estate consultant; (89) "real estate consultant" means....
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....irmed against the respondent under this category. 11. Regarding tax liability of the appellant under the category of maintenance or repair service we note that they have entered into an agreement with M/s Star Estate Management Ltd. for maintenance of entire building including common area etc. The appellants are required to provide technical advice to M/s Star Estate regarding major repairs and modifications of the said property. We note that the Original Authority after extracting the statutory definition of "maintenance or repair service" in terms of Section 65 (64) from 01/07/2003, held that such activity of providing advice cannot by itself be categorized as management, maintenance or repair service. On careful examination of the statutory definition and the analysis made in para 3.5.1 of the impugned order we note that there is nothing in the present grounds of appeal by Revenue to persuade us to interfere with the said findings. Advice or consultancy rendered by the appellant is not covered by maintenance or repair of immovable property. Admittedly the appellants are not involved in any activity of management, maintenance or repair. 12. The Original Authority confirmed serv....