The Hon’ble Supreme Court vide Circular F. No. 4/SG/2015 dated January 21, 2015 has decided to discontinue the practice of printing and rolling out hard copies of Judgments by the Editorial Branch of the Registry for contingent/miscellaneous requirements with effect from February 1, 2015. Previously eighty copies of Judgments used to be rolled out and printed. The number has been reduced to 14/16/18 depending upon the judgment being announced in civil/criminal or death case.
With effect from February 1, 2015 for purpose of contingent/ miscellaneous requirements, if any, all Branches of the Registry as well as officials posted at the residential offices of the Judges should download the judgments from the official website of the Supreme Court of India and accordingly shall regulate their day-to-day function.
SERVICE TAX
NOTIFICATIONS/CIRCULARS
Change in the Jurisdiction of Principal Commissioners of Service Tax and Central Excise
In exercise of the powers conferred by Rule 3 of the Central Excise Rules, 2002 and Rule 3 of the Service Tax Rules, 1994, the Central Board of Excise and Customs (“the Board”) has issued a Notification No. 1/2015-ST dated January 20, 2015 to notify change of Territorial jurisdiction of the Principal Commissioners of Service Tax, Commissioners of Service Tax, Principal Commissioners of Central Excise and Commissioners of Central Excise.
RECENT CASE LAWS
Renting of a building for a hotel, is not liable to Service tax under 'Renting of immovable property’ services
Jai Mahal Hotels (P.) Ltd. Vs. Commissioner of Central Excise, Jaipur [(2015) 53 taxmann.com 206 (New Delhi - CESTAT)]
Jai Mahal Hotels (P.) Ltd. (“the Appellant”) entered into a joint venture agreement dated August 28, 1985 with Indian Hotels Company Limited (“IHCL”) for running hotel business at immovable property owned by the Appellant. The Department contended that the Appellant had provided the taxable service namely ‘Renting of immovable property’, defined in erstwhile Section 65(90a) read with Section 65(105)(zzzz) of the Finance Act,
1994 (“the Finance Act”). Accordingly, demand of Service tax along with interest and penalty was confirmed against the Appellant for the period from June, 2007 to March, 2010.
Being aggrieved, the Appellant filed an appeal before the Hon’ble CESTAT, Delhi arguing that 'hotel buildings' were not covered under taxable service in view of the exclusion clause under Section 65(105)(zzzz) of the Finance Act and even otherwise, there was no provision of service, as there was a joint venture.
The Hon’ble CESTAT, Delhi after analyzing exclusionary and inclusionary clauses under Explanation I to the erstwhile Section 65(105)(zzzz) of the Finance Act, held that as per Explanation 1(d) to erstwhile Section 65(105)(zzzz) of the Finance Act, ‘immovable property’ does not include buildings used for purpose of accommodation, including hotels. Hence, buildings used for, or as, hotels do not amount to immovable property.
Therefore, renting of a building for a hotel i.e. buildings used for purpose of accommodation including hotels is covered by exclusion clause and does not fall within ambit of taxable service namely ‘Renting of immovable property’.
The alternative argument of the Appellant as regards joint-venture was not discussed and the matter was decided in favour of the Appellant relying upon the provisions under Section 65(105)(zzzz) of the Finance Act.
Service Tax on Renting of Immovable property paid with interest – Penalty under Section 76 of the Finance Act, 1994 waived as issue was in dispute and has still not attained finality
Shri Mahesh Vaktawarmal Rathod Vs. Commissioner Of Central Excise, Pune-III [2015-TIOL-178-CESTAT-MUM]
Shri Mahesh Vaktawarmal Rathod (“the Appellant”) rented out their premises to M/s Loot India Pvt. Ltd. Renting of immovable property was brought under the Service tax net under erstwhile Section 65(105)(zzzz) of the Finance Act, 1994 (“the Finance Act”) w.e.f. June 1, 2007. The levy was challenged by M/s Retailers Association of India and the matter travelled to the Hon’ble Supreme Court. The Hon’ble Supreme Court vide its Order dated October 14, 2011 stayed the operation of levy (only in respect of Service tax liability from June 1, 2007 to September 30, 2011) subject to certain conditions, such as payment of specified portion of the Service tax to be in installments. In the present case, the Appellant paid the Service tax on December 12, 2012 with interest and also filed the Service tax returns.
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