TaxTMI 
TaxTMI 
2025 (7) TMI 212
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....R/DM/RTK/2013-14 dated 24.01.2014, whereby the Commissioner upheld the demand of service tax under the category of "Renting of Immovable Property Service" on a portion of the amount received as "upfront fee" under the provisions of Finance Act,1994 Act, 1994. 2. The Appellant is a company registered under the Companies Act, 1956 and is promoted by Government of India and Government of NCT of Delhi for implementation and operation of Delhi Mass Rapid Transit System Project in the National Capital Region. 3. The appellant has been authorised by the Union of India and Government of NCT of Delhi to generate revenue by way of property development on the lands allotted to it by various agencies, which would be a part of the MRTS Project. Th....
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....llant from various customers under the Concession Agreements entered prior to 1.7.2010 is exigible to service tax on or after 1.7.2010 under "Renting of Immovable Property Services". 8. Though basically both the sides agree that the issue stands settled by the Larger Bench of the Tribunal in the case of Rajasthan Sate Industrial Development and Investment Corporation Ltd. Interim order no's. 1/2025 & 1/2025 dated 27.01.2025(ST Appeal No. 50553 of 2017 & 89766/2013 however, learned counsel for the appellant has raised the plea that whether "One Time Premium" received for acquiring the lease hold right, i.e. the consideration received for agreement to lease would also be exigible to service tax is a question which has been left un-answered....
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....would be leviable to service tax under Section 65(105)(zzzz) of the Act. In that view, the Bench observed as under:- "40. It is not possible to accept the contention advanced by the learned counsel for the appellant. As noted above, premium is a consideration paid for being let into possession prior to the creation of the tenancy so as to enable the person to enjoy the benefits so granted. It has been repeatedly held that when the interest of the lessor is parted for a price, the price paid is called premium, while rent is the periodical payment for the continuous enjoyment of the benefits under the lease. Under section 105 of the Transfer of Property Act, lease has been defined to include both the one time premium amount and the p....
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....e (a) "Renting of Immovable Property". In view thereof, the contention of the learned counsel that "Renting of Immovable Property" is excluded from leviability of service tax by virtue of sub-clause (a)(i) of Section 65B(44) cannot be accepted. The term "premium" was analysed as a payment for being allowed to take possession of the immovable property and has to be treated as the amount received for "renting" of immovable property. The reference was accordingly answered as under:- "The value of "premium" or "salami" is exigible to service tax under "renting of immovable property" for the period prior to 1.07.2012 under Section 65(105)(zzzz) of the Finance Act and from 01.07.2012 under Section 66B of the Finance Act." 11. We....
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....versus C.C.E & S.T.- Ahmedabad-III, ST Appeal No. 10193 of 2017. 4. M/s. Luxmi Township Ltd. Vs. Commissioner of CGST & CX, Siliguri Commissionerate ST Appeal No. 76847 of 2016 13. We agree with the learned counsel for the appellant that the appellant being a Public Sector Undertaking could be under a bonafide belief that no service tax is leviable on the "upfront fee". The issue related to the interpretation of the provisions and diversion views were taken by different Benches of the Tribunal as noted by the Larger Bench in Rajasthan State Industrial Development & Investment Corporation Ltd. (supra). The controversy has been settled at rest by the decision of the Larger Bench delivered on 27.01. 2025. It has been an accepted pr....