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2014 (9) TMI 781 - AT - Service TaxCommercial or industrial construction service - site formation service - Imposition of penalty - Held that:- As regards the commercial or industrial construction service and the site formation service, the applicant does not dispute the classification or the computation of demand and therefore, the appellant is liable to pay the entire service tax demand confirmed along with interest thereon and only the amounts actually paid by them and appropriated has to be excluded for the purposes of recovery. Therefore, we direct the appellant to make pre-deposit of entire service tax confirmed in respect of “Commercial or Industrial Construction Service” and “Site Formation and Clearance Service” along with interest thereon (excluding the amount already deposited). Renting of immovable property - Held that:- Only if vacant land exists as it is without any building, the exclusion clause would apply. The fact that the area of the land appurtenant to the building being more than the area of the building would not make any difference. The Ld. Adjudicating authority has dealt with this matter in detail in paras 88 to 90 of the impugned order and we do not find any fault in the reasoning adopted by the adjudicating authority. Therefore, the demand of service tax in respect of the land and building rented to M/s. Reliance Industries Ltd. is prima facie, sustainable in law. As regards the land and building rented out to M/s. Avinash Automobiles Pvt. Ltd., we note that the premises leased out consisted of a factory building and vacant land with a common compound wall and security gate. The appellant has also not been able to lead any evidence to the contrary nor did they furnish any evidence of the alleged construction on the vacant land subsequent to the lease agreement. Therefore, the Ld. adjudicating authority was correct in concluding that the consideration received for both the land and building would be leviable to service tax under the category of “Renting of Immovable Property Service”. The law was also respectively amended by the Finance Act, 2010 deeming renting of immovable property as a taxable service since 1-6-2007 which was also upheld by the Hon’ble High Court of Delhi in the above decision. In view of these judicial pronouncements, there is no doubt that the activity undertaken by the appellant is a taxable service and has always been so with effect from 1-6-2007. Further, in the Finance Act, 2012, a provision was made for waiver of penalty in case a service provider discharged the service tax liability along with interest in respect of renting of immovable property service within a stipulated time-limit. But, the appellant did not exercise their option for availing this facility. Having failed to avail of the opportunity, the contention for waiver of penalty is not acceptable. - Decided against assessee.
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