Lodging rents and service tax liability

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This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

17 May 2016 Dear experts on Service Tax,
A lodge has 20 rooms out of which 6 rooms are AC and 14 rooms are NON-AC.
The room rent for Standard Non AC is Rs.950/- plus Luxury tax of 5% which comes to Rs.998/- per day.
The Deluxe AC Room rent per day is Rs.1400/- plus Luxury Tax @5% which comes to Rs.1470/- per day.
As per Service Tax Act, if the room rent of a lodge/inn is below Rs.1,000/- per day, including all amenities, it is exempt from service tax.
My question is whether the assessee is liable to SERVICE TAX, if the following conditions prevail:
a) The Gross Room rents per annum from Standard Rooms ( below Rs.1000/-per day ) is above Rs.900000/- per annum.( The minimum limit for ST Registration)
b) The Gross Room rents from Deluxe Rooms (Above Rs1000/-) is above Rs.900000/. If we get registered under ST., shall we have to pay ST on room rents of Standard ( Which is below Rs.1,000/- per day)
c) The Gross rents from both the Standard- Deluxe exceed Rs.10,00,000/- per annum- but neither of each class do not exceed Rs.9,00,000/-. Whether Registration or ST is applicable?
Please clarify the status of service tax liability for the above three conditions.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

17 May 2016 a) Not liable for service tax and registration.
b) No need to pay service tax on room rent of standard.
c) No need for registration and ST payment.

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