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2014 (11) TMI 499 - AT - Service TaxRenting of Immovable Property - cum-duty value - levy of service tax on security amount - Imposition of interest and penalty - Benefit of Section 80 - Held that:- Admittedly, the security deposit collected by the appellant is refundable at the time of termination of lease/rent agreement. Therefore, the said security deposit cannot form a part of service provided by the appellant. Therefore, on the said amount, service tax is not payable. Cum-duty price - As per the agreement, the service tax is payable separately by the lessee. As the appellant has not recovered service tax from the lessee, they may recover separately. Therefore, the contention of the appellant as they have not recovered the service tax from the lessee, the rent recovered by them be treated as cum-service tax is not acceptable. In these circumstances, we hold that the rent received by the appellant shall be treated as gross value of taxable service and on the said amount the appellant is required to pay service tax. Levy of penalty - On the understanding of the appellant that what amount of rent they received the same is treatable as cum-service tax, therefore, they have not paid full amount of service tax. This understanding by the appellant is not acceptable. In these circumstances, substantial benefit of Section 80(2) cannot be denied. In these circumstances, we hold that the appellant is entitled for the benefit of dropping the penalty on the appeal as per Section 80 (2) of the Finance Act, 1994 - Decided in favour of assessee.
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