TaxTMI 
TaxTMI 
2024 (4) TMI 435
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....nd as per the impugned order is as follows: Period Service Tax short paid (Rs.) Excess amount paid adjusted (Rs.) Net Tax liability (Rs.) 50% penalty for 2011-12 to 2014-15 Penalty payable (Rs.) Oct-2011 to Mar. 2012 56,18,102 11,49,859 44,68,243 22,34,122 22,34,122 2012-13 31, 417 31,417 15,709 15,709 2013-14 13,33,867 13,33,867 6,66,933 6,66,933 2014-15 24,91,787 24,91,787 12,45,894 12,45,894 2015-16 -11,49,859 Apr. 2016 to Sep. 2016 2,21,206 2,21,206 2,21,206 TOTAL 85,46,520 85,46,520 43,83,864 2. Shri Raghunathan, learned consultant for the appellant mainly submitted that: i. The various services rendered by them are in the nature of civic amenities like bus stand, markets, slaughter house, parking, etc; which are part of the negative list and these are the functions entrusted to the corporation under article 243W of the Constitution of India. ii. The entire methodology adopted by the audit team are based on the entries in the income and ex....
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....indings of the Commissioner submits that the Commissioner has taken into consideration the errors of calculation and devised the correct method of calculation of service tax based on the value reflected in the "Income and Expenditure statement and the Advanced Accounts", hence there is no dispute as far as the valuation is concerned. With regard to renting of immovable property he has relied on the decision of the Hon'ble High Court of Madras in the case of R. Nambi versus Tenkasi Municipalit:y 2015 (37) STR 696 (Mad.) where it was held that: "17. It is further submitted that Section 66B of the Act deals with charge of Service Tax on and after Finance Act, 2012 and it states that there shall be levied a tax (Service Tax) at the rate of twelve per cent on the value of all services, other than those service specified in the negative list, provided or agreed to be provided in the taxable territory by one person to another and collected in such manner as may be prescribed. Further, it is submitted that prior to 10-5-2013, there was an explanation under Section 66B, which states that for removal of doubts, it is hereby clarified that the references to the provisions of Section ....
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....s of people in terms of a Scheme announced by the Government, by itself, does not take away the tax liability. "Renting of immovable property" services with reference to renting, leasing, licensing, or other similar arrangement of immovable property for use in course for "furtherance of business or commerce". The exclusion given is with the reference to renting of such property by religious body or educational body. We could not find any exclusion from the tax entry which will apply to the appellants. Though the appellants are created by an Act and are performing as a local Government, there is no bar in taxing their activities if the immovable property rented out by them is used in the course for "further course of business or commerce". Admittedly, in the present case, the shops premises are used for business or commerce. In such situation, we find no reason for interfering with the findings of the lower authorities regarding tax liability of the appellant under the category of "renting of immovable property". 3.2 Regarding Service Tax liability on renting of vacant land, we note that the learned AR submitted that the present dispute is not with reference to any vacant land bu....
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....y to the recipient of such public amenities but had licensed certain private entities to operate such facilities as a business endeavour to earn profit. He observes that the services involved in each of these proposals are in the nature of renting of immovable property including vacant land owned by the corporation and would fall within the scope of taxable service of "renting of immovable property". He also notes that the agreement entered by the appellant with their respective licences' that they are contractually obliged to remit Service Tax to the appellant in addition to the respective license fee as Service Tax has been collected by the appellant; and in these cases, they are bound to remit such Service Tax collected in terms of Section 73 of the Finance Act, 1994. Countering these arguments, the appellant submits that all these activities are in the nature of public amenities and the services are rendered to fulfil the constitutional responsibility as a civic body. It is further submitted that the corporations are allowed to execute these functions either directly or by appointing an agent on their behalf and the fact that the fees are collected through the agent or an inter....
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....rges. Since the amounts are not entirely refundable deposits but part of the amounts have been retained as payments for services rendered to M/s. Reliance Jio Infocomm Limited, the appellant is liable to pay Service Tax. However, the appellant's grievance is that these amounts do not figure in their 'Income and Expenditure Statement' along with the 'advanced accounts' which has been the basis for arriving at the taxable value; though; they do not dispute the above facts. Since the agreements are on record and clearly establish that part of the amounts have been retained by the appellant for certain services rendered by them to M/s. Reliance Jio Infocomm Limited, the demand of Service Tax is justified and to that extent, the order is upheld. These agreements were not on record and admittedly, the payments were also not shown in the 'income and expenditure statement' thus, non-disclosure of the amounts collected and retained amounts to suppression of facts with intent to evade payment of duty. Therefore, the Service Tax on Telecom charges is upheld, for these agreements beyond the normal period. 5.1 From Table 1 at Sl. No.13, the demand is on taxable value 'arrears recovery pertai....
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....e notice and considering the accounting methods has rightly arrived at the taxable value based on "income and expenditure statement" and the "advanced accounts". We do not find anything wrong in the methodology adopted by the Commissioner, which is also not disputed by the appellant except for stating that he has traversed beyond the notice. 7. The learned Consultant submits that the appellants are local self-government body whose accounts are publicly audited and are available on the public domain and they do not stand to gain anything by suppressing taxable value with intent to evade payment of service tax as all transactions are government to government. The issue that arises for consideration is as to whether the Revenue was justified in invoking the extended period of limitation. The only justification given by the Commissioner is that 'under the self-assessment scheme, the tax paid is statutorily bound to assess themselves and discharge their tax liability, upholding the tenets of mutual trust and responsibility. The assessee had failed in their statutory responsibility of self-assessment is evident from the short levy unearthed on reconciliation of their tax performance. ....