SERVICE TAX ON RENT
This query is : Resolved
P.S.VISHWANATHAN
(Querist)
07 November 2008
OUR COMPANY'S PROPERTIES(FLATS IN GURGAON)
HAVE BEEN GIVEN ON RENT TO A MULTINATIONAL WHICH ARE BEING USED BY THEM FOR RESIDENTIAL PURPOSE ONLY.
THEY CONTEND THAT SERVICE TAX IS TO BE CHARGED BY US WHEREAS ACCORDING TO OUR INTERPRETATION NO SERVICE TAX IS LEVIABLE FOR PROPERTIES NOT USED FOR COMMERCIAL PURPOSE. WILL YOU PLEASE CLARIFY THE CORRECT POSITION?
HAVE BEEN GIVEN ON RENT TO A MULTINATIONAL WHICH ARE BEING USED BY THEM FOR RESIDENTIAL PURPOSE ONLY.
THEY CONTEND THAT SERVICE TAX IS TO BE CHARGED BY US WHEREAS ACCORDING TO OUR INTERPRETATION NO SERVICE TAX IS LEVIABLE FOR PROPERTIES NOT USED FOR COMMERCIAL PURPOSE. WILL YOU PLEASE CLARIFY THE CORRECT POSITION?
P.S.VISHWANATHAN
(Querist)
07 November 2008
GRATEFUL FOR AN EARLY CLARIFICATION
07 November 2008
Your view is correct.Pl refer Ministry's circular DOF/334/1/2007-TRU,dated 28-02-2207.
CA. C V SURYAM
(Expert)
07 November 2008
Sri Chackrapani, would you please explain further on the circular and if possible please provide a copy of the same to cvsuryam@rediffmail.com
07 November 2008
Relevant extract is as follows:-
Renting of immovable property for use in the course of furtherance of business or commerce-sec 65(105)(zzz)-is the taxable service.Renting includes letting,leasing,licensing or other similar arrangement. The contract is for right-to-use an immovable property for a consideration. Immovable properties excluded from the scope of this service are:
residential properties
....
....
Pl refer page 1139 of Taxmann's service tax-How to meet your obligations-volume-2.
Renting of immovable property for use in the course of furtherance of business or commerce-sec 65(105)(zzz)-is the taxable service.Renting includes letting,leasing,licensing or other similar arrangement. The contract is for right-to-use an immovable property for a consideration. Immovable properties excluded from the scope of this service are:
residential properties
....
....
Pl refer page 1139 of Taxmann's service tax-How to meet your obligations-volume-2.
SANJAY VERMA
(Expert)
07 November 2008
agreed with warrier
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