TaxTMI 
TaxTMI 
2026 (3) TMI 1634
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....under Section 65(105) (zzzz) of Finance Act, 1994; consequently, investigation was initiated in the year 2013 and on completion of investigation, show-cause notice was issued to them on 19.04.2013 proposing to recover service tax of Rs.1,22,67,767/- for the period October 2007 to March 2012 invoking proviso to Section 73(1) of the Finance Act, 1994. For the subsequent period from April 2012 to March 2013, show-cause notice was issued on 14.10.2013 for recovery of Rs.45,51,458/- and for the period April 2013 to February 2015 for recovery of service tax of Rs.65,28,328/- with interest and penalty. On adjudication, the total demand of Rs.2,33,47,553/- for the period October 2007 to February 2015 has been confirmed with interest and penalty of Rs.1,68,19,225/- under Section 78; penalty of Rs.6,52,833/- under Section 76(1) read with Section 78B; Rs.10,000/- and Rs.10,000/- under Section 77 of the Finance Act, 1994 were imposed. Hence, the present appeals. 3.1. At the outset, the learned Chartered Accountant for the appellant has submitted that the appellant M/s. St. Patrick's Church is a religious trust registered under the Indian Trust Act, 1882 and recognised under the Income Tax A....
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....ence, the services of renting out of the shopping complex are not chargeable to service tax. 3.3. Also, he has submitted that the appellant being religious body, there is no intention to evade payment of tax by suppression or misdeclaration. Hence, invocation of extended period and imposition of penalty is bad in law. 4. Learned AR for the Revenue has reiterated the findings of the learned Commissioner. 5. Heard both sides and perused the records. 6. The main issues involved in the present appeals for consideration are, whether: (i) the appellant are required to discharge service tax under the category of 'Renting of Immovable Property Service' for the period from October 2007 to June 2012 and (ii) the said service of renting of commercial premises is exempted under Notification No.25/2012-ST dated 20.06.2012 from 01.07.2012 to February 2015. 7. Undisputed facts of the case are that the appellant is a Church and thus a religious body being registered as a charitable organisation under Section 12AA of the Income Tax Act, 1961. Within the premises of the Church, a commercial complex is situated comprising of 105 shops which were given on rent for commercial purposes an....
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....the periods, observed that the appellant are liable to pay service tax only w.e.f. 01.07.2012 and not before that. The Tribunal analysing the principles laid down by the Hon'ble Supreme Court and the definition of religious body held as follows:- 5.3 The definition of a 'religious body' has to be broader than that of a 'religious denomination'. A religious denomination is a subgroup within a religion. Religious body can be a part of a religion or a religious denomination and established with the objective of propagating religion and primarily serving the members of its community. Religions are generally propagated and administered with the help of organizations within its domain that are closely integrated with society. These organisations are understood in common parlance to be 'religious bodies' as distinct from religion per se or a religious denomination. Hence, they are recognised by the public and societal institutions as a religious body. In the absence of any definition of a 'religious body' in law, the common understanding would have to be taken into consideration. By definition a Diocese is a district under the pastoral care of a Bi....
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....or the advancement of religion or promotion of religious worship was treated as a charitable purpose and, therefore, a society formed for such a purpose would be a charitable society under Act 21 of 1860. The only condition was that it should be for the benefit of the public. No doubt, in some statutes enacted subsequent to Act 21 of 1860, the Legislature used the words "charitable" and "religious" but the definition of these words was expressly stated to be for the. purposes of those, Acts. The subsequent legislation, the Madras High Court held, would not be helpful in interpreting the word "charitable" in Act 21 of 1860. The real question was: "What did the term mean in 1860?" We are in agreement with the view of the Allahabad and Madras High Courts. In fact, Lord McNaughten in his celebrated judgment in CIT v. Pemsel said that charitable purposes which came within the language and spirit of the statute of Elizabeth (43 Eliz Ch. 4) could be grouped into four heads (i) relief of poverty, (ii) education, (iii) advancement of religion, and (iv) other purposes beneficial to the community not coming under any of the preceding heads. The words in Act 21 of 1860 are, therefore, to be un....