Service tax on plant and Machinery moveable in nature

BK Bhargava (Business) (57 Points)

30 December 2008  

Dear friend,

There is confusion on applicability of SERVICE TAX on IMMOVABLE & MOVEABLE property.

Notification No. 23/2007 S.T> dated 22/5/2007 w.e.f. June 1, 2007 takes in the net "Renting of Immovable property which includes Factory, Office Building, Warehouse, theatres, exhibition halls and multiple-use-buildings (sec-65 (90a).

Is is fair to demand service tax on Moveable Property such as Machinery, trucks, dumper, tractor etc under the grab of above notification or any other count under prevailing rules of Service tax ?  In our opinion there is no applicability under any notification, act or rules in force by which above rental receipts from moveable property are under SERVICE TAX NET.  What would be the treatment in following circumstances if for example during Financial Year 2006-07 :

Rental receipt from Moveable machinery is as under:

Rs. 8,50,000/- receipt from rent of machinery (moveable) and portable in nature

                           which is not Rental from IMMOVABLE Property (Sec 65 (90a).

Please clarify the position under Service tax act. 

Regards

Manu-Priyank

Management student.