TaxTMI 
TaxTMI 
TaxTMI 
2025 (8) TMI 5
X X X X Extracts X X X X
X X X X Extracts X X X X
....hapter V of the Finance Act, 1994. The appellant was regular in payment of service tax and furnishing returns. 2.1. On the basis of audit conducted on the books of accounts of the appellant, a Show Cause Notice dated 18-10-2016 was issued to the appellant demanding Service Tax of Rs. 5,58,73,725/- for the period 2011-12- 2014-15 by invoking extended period of limitation. The said Notice was adjudicated vide the impugned Order in Original dated 22-02- 2017, wherein the demand of service tax made in the Notice has been confirmed along with interest and equal amount of tax as penalty under Section 78 of the Finance Act,1994. A penalty of Rs.1,00,000/- was also imposed under Section 78A of the Finance Act on the Manager (Accounts) of the appellant Company. Aggrieved against the confirmation of service tax along with interest and penalty, the appellant company and the Manager (Accounts) have filed these appeals. 3. The Summary of the demand under challenge in the impugned order are as under : Sl. No. Period Demand Issue 1 July,12 to March,2014 Rs.2,677/- Under reverse charge basis on the amount reimbursement of expenses of Advocate 2. 2014-15 Rs.1,03,652/- Under RCM, the S....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... electricity charges etc. The appellant states that they have collected the actual amount on the basis of consumption. In support of this claim, the appellant submitted a Chartered Accountant's Certificate and ledger account, payment particulars from which it can be seen that the amount paid to the WBSEDCL is more than what is collected. The appellant submits that the issue is squarely covered by the decision of this Tribunal in their own group companies appeals, in Forum Mall Management Services Pvt Ltd VS. Commissioner of Service Tax, vide Final Order No. 77044-77045/2024, dated 23-09-2024. The same view has been taken in the decision rendered vide Final Order No.76299/2024, dated 10-07-2024 in the case of M/s.Choicest Enterprises limited Vs. Commissioner of Service Tax, Kolkata. Accordingly, the appellant submits that the demand of service tax confirmed on this count is not sustainable. 3.4. Regarding the demand of Service Tax of Rs.90,48,885/-confirmed in the impugned order, the appellant states that the said consideration has been received against transfer of assignment/sub-lease of leasehold property. The appellant states that they have acquired the property located at Block....
X X X X Extracts X X X X
X X X X Extracts X X X X
....s been made by invoking the larger period. In the instant case, we find that there is no element of fraud, collusion or suppression of facts is present. We find that the appellant has been filing returns regularly and disclosed all information in the returns filed. Therefore, we hold that invocation of the larger period is not applicable in this case. In support of this view, we rely on the decision of the Hon'ble Apex Court in the case of Jet Airways (India) Ltd. Versus Commissioner - 2017 (7) G.S.T.L. J35(S.C.). Thus, we hold that the demand confirmed on this count is not sustainable and hence we set aside the same. 7. Regarding the demand of service tax of Rs.1,03,652/- under reverse charge basis, we observe that the service provider has charged, collected and paid Service Tax. Therefore, the demand of service tax on the same service again would tantamount to double taxation. In support of this view, we rely on the decision in the case of SHREE SAIBABA CHEMICALS INDUSTRIES VS. COMMISSIONER OF CENTRAL EXCISE & SERVICE TAX, VADODARA-II, (2025) 28 Centax 158 (Tri.-Ahmd) [06-03-2025]. Thus, we hold that the demand confirmed on this count is not sustainable and hence we set asid....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... failure and the appellants are charging for the same. We find that electricity is specifically covered under Tariff Heading27 of the Central Excise Tariff Act. We find that as per the provisions of Maharashtra Value Added Tax Act, 2002, electricity is also covered under Schedule A sl.no.20 and charged to Nil rate of tax. In view of this, we find the electricity is goods chargeable to duty under Central Excise Tariff as well as under the Maharashtra Value Added Tax Act, 2002. Therefore, the supply of electricity to tenant amounts to sale of goods and not supply of service. Further the Notification No.12/03 ST dated 20/6/2003exempt from service tax, any value of goods supplied by service provider to service recipient. Further we find that the Commissioner of Central Excise Pune. III vide Order- in-Original dated 28.11.2011 relied upon by the appellants dropped the proceedings which were initiated on the same ground in the case of M/s. Panchshil Tech Park Ltd. The Commissioner of Central Excise in the adjudication order held that electricity is goods and chargeable to Nil excise duty. The decision of the adjudicating authority is accepted by the Revenue as per the communication dated....
X X X X Extracts X X X X
X X X X Extracts X X X X
....signment of commercial space together with proportionate right on leasehold land cannot be called as 'lease' and hence it would not fall under the definition of taxable service as defined under Section 65(105)(zzzz) of the Finance Act, 1994. 9.2. We find that the issue involved in this case is squarely covered by the decision of this Bench in the case of LUXMI TOWNSHIP LTD. Versus COMMISSIONER OF CGST & C. EX., SILIGURI, 2023 (79) G.S.T.L. 232 (Tri. - Kolkata) / (2023) 11 Centax 238 (Tri. - Kolkata). 9.3. We also find that the decision of this Tribunal in the case of SAFARI RETREATS PVT. LTD. VS. PRINCIPAL COMMISSIONER OF G.S.T. AND C.EX. BHUBANESWAR, (2025) 26 Centax 53 (Tri. -Cal) is squarely applicable to the facts and circumstances of this case. The relevant part of the said decision is reproduced below:- 10. Section 54 of the Transfer of Property of Act, 1882, reads as under: 'Sale' is a transfer of ownership in exchange for a price paid or promised or part-paid and part- promised". It is an admitted fact on record that the appellant has transferred the leasehold rights of the immovable property for one time consideration termed as SubLease Premium". 10.1. Th....
X X X X Extracts X X X X
X X X X Extracts X X X X
....t paid cannot be equated to 'Rent'. 10.3. The Hon'ble Apex court in the case of Commissioner of Income Tax v. The Panbari Tea Co. Ltd. [[1965] 57 ITR 422 (SC) ], had the occasion to differentiate between the 'Premium' and 'Rent'. The relevant portion of this decision is extracted below:- "Under section 105 of the Transfer of Property Act, a lease of immovable property is a transfer of a right to enjoy the property made for a certain time, express or implied, or in perpetuity, in consideration of a price paid or promised, or of money, a share of crops, service or any other thing of value, to be rendered periodically or on specified occasions to the transferor by the transferee, who accepts the transfer on such terms. The transferor is called the lessor, the transferee is called the lessee, the price is called the premium, and the money, share, service or other thing to be so rendered is called the rent. The section, therefore, brings out the distinction between a price paid for a transfer of a right to enjoy the property and the rent to be paid periodically to the lessor. When the interest of the lessor is parted with for a price, the price paid is pr....
X X X X Extracts X X X X
X X X X Extracts X X X X
....fies that while the Premium or Salami is a one-time payment, the 'rent is payable at regular intervals. It also recognizes that in trade and commerce practice of payments on account of premium and rent exists. 10.4. The issue as to whether the Service Tax is payable on One time premium' in case of long term leasing, was before the Tribunal in the case of Greater Noida Industrial Development Authority v. Commissioner of Central Excise and Service Tax, Noida 102015 (38) S.T.R. 1062 (Tri-Del)). The relevant extracts are reproduced below :- "10. Whether the Service Tax is chargeable only on the lease rent or also on one time premium amount charged in respect of long term leases? 10.1 A lease is a transaction, which has to be supported by consideration. The consideration may be either premium or rent or both. The consideration which is paid periodically is called rent. As regards premium, the Apex Court in the case of Commissioner of Income Tax, Assam and Manipur v. Panbari Tea Co. Ltd. reported in (1965) 3 SCR 811 has made a disunction berween premium and rent observing that when the interest of the lessor is parted with for a price, the price paid is premium or salami, b....
X X X X Extracts X X X X
X X X X Extracts X X X X
....eement with KMC, appellant is entitled to all the construction / erection / structure of any nature whatsoever as the absolute owner thereof and to enter into agreement for transfer of its leasehold rights together with the constructed areas belonging to it. Accordingly, the appellant sub-leased the properties to various parties. In respect of the land to be mutated by the sub-lessee in their name, the sub-lessee is deemed to be the lessee of the said plot and has to apply to KMC for renewal of lease after expiry of the 99 years lease period. After mutation, the full rights and title goes in favour of the sub-lessee, subject to renewal of the original deed after its expiry. Therefore, the appellant treated the said transaction as 'sale of leasehold rights' and not paid service tax on the outright transfer of lease hold rights. However, the department considered the transaction of long term lease undertaken by the appellant as a taxable service liable for service tax under the category of 'Renting of immovable property service'. The department considered the one time Premium/ Salami received by the appellant from the sublessee as consideration towards the taxable ser....