TaxTMI 
TaxTMI 
2025 (3) TMI 744
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.... (d) penalties imposed in terms of sections 70, 77(1) and 78 of the Act are upheld & the penalty under section 78 shall be equal to amount of service tax liability as per (a) above. As the quantum of service tax liability in respect of renting of shops is not worked out separately in the impugned order, the original authority is directed to quantify such service tax liability and communicate the same to the appellant within a period of ten days of receipt of this order. The appeal is disposed of in above terms." 2.1 Appellant is engaged in providing taxable services namely Renting of Immovable Property. However, they did not get registration with the Department and did not pay service tax by contravening the provisions of Rule 4 and Rule 6 of Service Tax Rules. 2.2 Inquiries were made vide letter dated 02.09.13, 13.09.13, 24.09.13, 18.10.13, 24.10.13 (Ist), 24.10.13(2nd), 13.02.14 and 18.02.14 and on the basis of replies received vide letters dated 30.09.13, 17.01.14, 12.03.14(Ist), 12.03.14(2) and 20.03.14, it is observed that appellant is engaged in (1) Renting of Shops which are partially constructed up to the level of Foundation/DPC(Damp Proof course) by them ....
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....+ Rs. 46997 SHEdu Cess) should not be demanded and recovered from them under proviso to section 73(1) of the Finance Act, 1994. 2. Interest on the above said amount should not be demanded and recovered under Section 75 of the Finance Act, 1994 3. Penalty under Section 78 of the Finance Act, 1994 should not be imposed upon them. 4. Penalty should not be imposed upon them under section 77 (1) (a) of the Finance Act 1994 for violation of Section 69 ibid read with Rule 4 of the Service Tax rules, 1994. 5. Late fees under Section 70 of the Finance Act, 1994 should not be recovered for non-submission of returns ST-3 as per para 10 above." 2.5 The said show cause notice was adjudicated as per the Order-in-Original dated 04.06.2015 by holding as follows:- "Order 1. I confirm the demand of Service tax amounting to Rs.48,40,691/- (Rs.forty eight lacs forty thousand six hundred ninety one only) under proviso to Section 73(1) of the Finance Act, 1994 against M/s Nagar Palika Parishid, Loni, District Ghaziabad. 2. I also confirm the demand of interest on said amount in terms of section 75 of the Finance Act, 1994. 3. I a....
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.... said amounts. As regards one time premium collected at the time of auction, in no way could be considered as renting activity and, therefore, in any case, said activity was not liable for service tax. Reliance is placed on the following decisions:- Greater Noida Industrial Development Authority Vs CST 2015 (38) STR 1062 (Tri.-Del.). CCE Goa Vs Mormugao Municipal Council 2017 (7) GSTL 228 (Tri.-Mumbai). 3.3 Learned Authorised Representative reiterates the findings recorded in the orders of the lower authorities. Further, she placed reliance by the decision of Hon‟ble Allahabad High Court in the case of M/s Greater Noida Industrial Development Authority, Noida 2015 (40) STR 95 (All.). 4.1 We have considered the impugned orders along with the submissions made in appeal and during the course of argument. 4.2 We find that there are two issues involved in the present case i.e.- i. service tax on one time premium collected. ii. On renting of shops. 4.3 In respect of first issue i.e. service tax on one time premium collected, we find the issue is squarely covered by the decision of Hon‟ble Allahabad High Court i....
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.... the provisions of the relevant statute for performing such functions is in the nature of a compulsory levy and are deposited into the Government account. Such activities are purely in public interest and are undertaken as mandatory and statutory functions. These are not to be treated as services provided for a consideration. Therefore, such activities assigned to be performed by a sovereign/public authority under the provisions of any law, do not constitute taxable services. Any amount/fee collected in such cases are not to be treated as consideration for the purposes of levy of Service Tax. 33. However, if a sovereign/public authority provides a services, which is not in the nature of an statutory activity and the same is undertaken for a consideration (not a statutory fee), then in such cases, Service Tax would be leviable as long as the activity undertaken falls within the scope of a taxable service as defined. 34. Letting of immovable property for consideration, which is determined on the basis of offers received from public at large by the assessee Greater Noida Industrial Development Authority is a service provided for consideration and not on payment of st....
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....„lease‟, as defined under section 105 of the Transfer of Property Act, includes both the one time premium amount and the periodical rent amount, it has to be held that the one time premium amount received by the lessor from the lessee for transfer of interest in the property would be leviable to service tax under section 65(105)(zzzz) of the Finance Act. 34. It is, therefore, not possible to accept the view expressed by the two Division Benches of the Tribunal in Greater Noida Industrial Development Authority and Kagal Nagar Parishad. ........ 49. In view of the aforesaid discussion, the inevitable conclusion that follows is that the value of "premium" during the period prior to 01.07.2012 and during the period w.e.f. 01.07.2012 would be exigible to service tax under "renting of immovable property". 50. The reference would, therefore, have to be answered in the following manner: "The value of "premium" or "salami" is exigible to service tax under "renting of immovable property" for the period prior to 01.07.2012 under section 65(105)(zzzz) of the Finance Act and from 01.07.2012 under section 66B of the Finance Act." 4.5 In view of the above....