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2015 (9) TMI 1724 - HC - Service TaxValuation of service tax - real estate agent service - value of the land is not includible in the assessable value for the purpose of computing the service tax or not - HELD THAT:- The AA has in the order dated 30th September 2013 come to the conclusion, on an analysis of the three MOUs entered into between the Appellant and SI, that the Appellant was working as an agent for SICCL and further that it had rendered two kinds of taxable services: one as a real estate agent/real estate consultant under Section 65 (89) of the FA and the other relating to levelling of soil including filling of gorges/nallah, removing of shrubs, grass and rubbish etc. classifiable under the head 'site formation and clearance excavation and earth moving and demolition services', as defined under Section 65 (97a) of the FA. The Court is of the view that the Appellant has made out a prima facie case on the aspect whether the entire amount received by it pursuant to the MoUs would be considered to be the 'gross value' for the purposes of computation of service tax liability. Indeed it appears that the AA agreed with the Appellant that the entire sum received by the Appellant for purchase of land could not form the basis for computation of the service tax - It further prima facie appears that the AA overlooked the fact that even as per the SCN no land in Kurukshetra was purchased although the Appellant received money for that purpose. The Appellant's explanation that it returned the said sum to SICCL in the form of shares in 13 of its group companies does not appear to have been considered. The Court is satisfied that the Appellant has made out a prima facie case and that the balance of convenience at this stage in making a conditional order of pre-deposit is in favour of the Appellant. Although the Court is not expressing any opinion on the contention of the Appellant that no taxable service has been rendered by it, and that in any event the entire profit earned by it cannot constitute the value of such services, the Court, for the purposes of determining the reasonable amount of pre-deposit to be made by the Appellant, takes note of the fact that the Appellant has after making a loss of ₹ 34,25,435 in regard to the purchase of land at Sriganganagar and a profit of ₹ 4,75,45,069 in respect of the purchase of land at Vadodara, earned a net profit of ₹ 4,41,19,634. If the service tax demand is computed at 10% of the said sum it would work out to ₹ 44,11,963. The appeal and application are disposed of.
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