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2018 (11) TMI 1472 - AT - Service TaxClassification of services - Real Estate Agent Services or not - It appeared to Revenue that the appellant was liable to pay the service tax under the classification ‘Real Estate Agent Service’ under section 65(88) of the Finance Act which defines a ‘real estate agent’ as a person who is engaged in rendering any service in relation to sale, purchase, leasing and renting, of real estate and includes a real estate consultant - time limitation. Held that:- There is no consideration defined and/or provided for the alleged service. In absence of any defined consideration for the alleged service, there is no contract of service at all, and hence the transaction is not liable to service tax. Under the facts and circumstances, it is found that the appellant entered into an agreement of trading in land, wherein they agreed to transfer, a measurement or area of land, in a particular area in favour of the Sahara India. The appellant was also obligated to examine the title of the prospective land owner and to further ensure the availability of land owner at the office of the Registrar for execution of the sale deed. In fact Sahara India instead of paying the price directly to the land owner, paid lump sum amount to the appellant. Thereafter the appellant identified the land, the seller, and after being satisfied with the title of the seller, entered into agreement with the seller and obtained power of attorney, in their favour. Thereafter the appellant transferred the land in favour of Sahara India. Thus the transaction is one of trading in land. In such transactions the appellant could either incur a loss or have a surplus (profit). It is very clear from the provision of the MoU that the amount payable to the appellant is not quantified and it is more of the nature of a margin and share in the profit of the deal in purchase of land. For levy of service tax, a specific amount has to be agreed between the service recipient and the service provider. As no fixed amount has been agreed in the MoU which have been signed between the parties, the amount of the remuneration for service, if any is not clear in this case - since the specific remuneration has not been fixed in the deal for acquisition of the land, both the parties have worked more as a partner in the deal rather than as an agent and the principle, therefore the taxable value itself has not acquired finality in this case. The MoU has not been executed fully and therefore the actual remuneration to the appellant have not got finalized and therefore issuing the show cause notice in such a stage was premature and unwarranted. Extended period of limitation - Held that:- The issue relates to interpretation, and there is no malafide on the part of the appellant. The transaction is duly recorded in the books of accounts maintained by the appellant. Further there is no suppression of information from the revenue - extended period not applicable. Appeal allowed - decided in favor of appellant.
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