Renting of immovable property

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This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

22 October 2012 One of my client has received rent from immovable property of around Rs. 22 lakhs but has failed to collect service tax from lessee. Can lessor collect service tax from lessee now or he wil have to pay service tax from his own pocket?

MOHAMMAD SALIM

MOHAMMAD SALIM (Expert)

24 October 2012 It depends upon the terms of the contract. If the amount of rent agreed is excluding taxes, the service tax can be claimed from lessee, however if the rent is inclusive of service tax then it cannot be seperately claimed.

Hope this would settle the issue....

Querist : Anonymous

Querist : Anonymous (Querist)

24 October 2012 Sir there is no description regarding service tax in lease agreement.

MOHAMMAD SALIM

MOHAMMAD SALIM (Expert)

26 October 2012 Even if there is no description , it needs to be seen whether there is any clause stating that the rent is all inclusive, in which case service tax cannot be claimed. however if silent we can claim the same....

However for final view we need to read each and every term of the agreement...

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