TaxTMI 
TaxTMI 
2026 (8) TMI 1069
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....cial year 2015-16 and 2016-17, the appellant had booked income under the head of Maintenance Fund and Corpus Fund but have not discharged service tax liability towards those amounts received. On being enquired, appellant mentioned that they were collecting those amounts from the buyers of flats for maintenance of the common area of residential complex but purely on behalf of the society. Department, however, observed that by the time of the audit, the society had not come into existence and the amount so collected by the appellant in the name of society charges remained in the possession of the appellant for being used towards the maintenance of the common area of residential complex. Relying upon rule 6 of the Service Tax Rules, 1994 and t....
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....further mentioned that since the appellant is the developer/builders of residential flats while selling the same, one time maintenance deposit from each of the buyer was being collected by the appellant. The so constructed residential complex, since has to be maintained by the housing society to be formed by the owners/buyers of the flats that though the amount was collected by the appellant but was kept separately and was shown in the books of account as 'liability' till the formation of society. Out of the said amount only the appellants were expected to pay various charges such as common electricity bills, water charges, security charges etc. Whatever balance was left in the said account at the time when housing society was formed, the s....
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.... 123 - CESTAT NEW DELHI the order under challenge is prayed to be upheld and the appeal is prayed to be dismissed. 5. Having heard both the parties and perusing the records, it is observed to be an undisputed fact that the appellant was collecting two different funds from the flat owners while selling them the flats constructed by the appellant, namely, the Maintenance Fund and the Corpus Fund. It is also coming as an undisputed fact that at the time of collection of those funds by the appellant, the housing society of owners/buyers of the flats was not in existence. Thus during the period in dispute (2015-16 and 2016-17), the appellant had collected these amounts from the flat buyers for taking care of maintenance of their residential c....
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....he negative list. The appellant has agreed to be responsible for providing said services till the housing society comes into existence. Admittedly, the housing society was not in existence during the period in dispute. It is held that the appellant was providing taxable services of maintenance, management and repair. Hence we do not find any infirmity in the order when the demand of service tax has been confirmed on the amount of Maintenance Fund received by the appellant during the disputed period (Rs. 655306/-). Therefore, to the extent was utilised by the appellant, the service tax demand on the utilised amount therefore, sustains. 9. The decision in the case of Mangalam Build Developers (supra) relied upon by the appellant does not s....