2023 (12) TMI 678

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....the industrial lands allotted by Maharashtra Industrial Development Corporation (MIDC) to various customers. The consideration received for such sub-leasing of the property was reflected in the books of account under the accounting heading "Sale of property/rights". On scrutiny of the books of accounts maintained by the appellant, the Service Tax Department alleged that sub-leased amount received by the appellant from various persons should be taxable under the category of 'renting of immovable property', defined as "service" under Section 65B(41) of the Finance Act, 1994. As against the claim of the Department for classification of the service under the category of 'renting of immovable property', the appellant had contended that the activ....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....f the Tribunal in the cases of Greater Noida Industrial Development Authority Vs. CCE & ST, Noida - 2015 (38) STR 1062 (Tri-Del), Gujarat Power Corporation Ltd. Vs. CCE & ST vide Final Order No. A/11392/2022 dated 18.11.2022, and M/s Luxmi Township Ltd. Vs. Commissioner of CGST & CS, Siliguri vide Final Order No. 77349/2023 dated 18.10.2023 to state that the issue arising out of the present dispute is no more open for any debate. 3. On the other hand, learned AR appearing for the Revenue reiterates the findings recorded in the impugned order and further submitted that since the premium amount was received by the appellant on periodical basis, the same should be considered as rent and since such rental amount is in context with immovable pr....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... by the appellant should be treated as consideration for provision of taxable service under the category of 'renting of immovable property', defined under Section 66E ibid. 6. Under the provisions of Section 66E ibid, the service under the category of 'renting of immovable property' has been considered as a declared service. Thus, any amount received towards 'rent' for letting out the property will only be liable for payment of service tax and not otherwise. As per the contractual norms, the rent amount has been fixed, which the appellant is entitled to receive from the lessee for letting out the property, which had not been disputed by the department in the present case. One time premium received by the appellant cannot be equated with re....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....e immovable property leased. Since taxing event under Section 65(105)(zzzz) read with Section 65(90a) is renting of immovable property, Service Tax would be leviable only on the element of rent i.e. the payments made for continuous enjoyment under lease which are in the nature of the rent irrespective of whether this rent is collected periodically or in advance in lump sum. Service Tax under Section 65(105)(zzzz) read with Section 65(90a) cannot be charged on the "premium" or 'salami' paid by the lessee to the lessor for transfer of interest in the property from the lessor to the lessee as this amount is not for continued enjoyment of the property leased. Since the levy of Service Tax is on renting of immovable property, not on transfer of ....