Service tax applicable to renting by charitable trust?

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yashsr (Querist)
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25 January 2013 Hello,

A Charitable Trust is registered under u/s 12AA(1)(b)(ii) r.w.s. SECTION 12 A of the Income Tax ACt 1961. A Property owned by the Charitable Trust is given on rent to the OFFICE OF THE INCOME TAX(HEAD QUARTERS) Rent amt : Rs. 1,27,700/- p.m.

The Trust is formed to fulfil the following objectives: RELIEF OF POVERTY, EDUCATION RELIEF, MEDICAL RELIEF, for advancement of society

Does the trust have to collect Service Tax?

MANOJ KUMAR SHARMA

MANOJ KUMAR SHARMA (Expert)
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26 January 2013 As i think the rent received by trust is for the earning profit it is not a charitable activity it is a business activity and it amounts to earning profit so it will come under service tax provision.

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yashsr

yashsr (Querist)
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26 January 2013 Hello,

Is renting a property to Income Tax Office(being Government) not exempt?

Is this not covered under advancement of any other object of general public utility in exemption 25/2012?

CA Vipin Jain

CA Vipin Jain (Expert)
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28 January 2013 Hi,

In my opinion renting of property to Income tax office is not advancement of any object of general public. It is not for benefit/welfare of public. also Income tax department does not covered under Government or Government authority, as there is specific definition of Government authority under mega exemption notification as as per that there are specific function to be carried out by authority to become government authority for mega exemption purposes.

It need a details analysis and discussion, so please consult to your service tax consultant for better clarity.

regards

CA Vipin Jain

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