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2019 (5) TMI 1413 - AT - Service TaxClassification of services - Renting of Immovable Property Services or not - renting of shops located in the Masjid precincts - extended period of limitation - penalty - HELD THAT:- For the period prior to June, 2012, the provision of Section 65(90a) of the Finance Act, 1994 defines renting of immovable property and exclude renting of immovable property by a religious body or to a religious body. The running of shops in the Mosque premises are being done by the society, which cannot be considered to be a religious body. Merely because the appellant, being a society, is maintaining the Mosque will not turn them into a religious body, though the same may be a charitable organization. The renting activity is not being done by the Mosque but the same is being undertaken by the society, which itself is not a religious body. There are no merits in the contention of the learned advocate that the appellant’s society being engaged in religious activities would get excluded from the definition of ‘Renting of Immovable Property’. Mega Exemption Notification No.25/2012 dated 20/06/2012 provides exemption from service tax to services provided by an entity registered under Section 12AA of the Income Tax Act, 1961 by way of charitable activities. As such, it is seen that the exemption stands granted to the entity registered under Section 12AA of the Income Tax Act. Extended period of limitation - demand stands raised for the period 2009-10 to 2013-14 by way of issuance of a show cause notice dated 29/02/2015 - HELD THAT:- Admittedly the issue involved is a bona fide issue of interpretation inasmuch as the appellant being a charitable organization could have been under a bona fide belief that no tax liability would arise against them. Revenue has not produced any positive evidence to show that such tax liability was not being discharged by the appellant with a mala fide intent to evade payment of duty - In the absence of any evidence, it can be held that the demand would be hit by bar of limitation - penalty also not justified. However a part of the demand would fall within the limitation period for which purpose the matter is remanded to the Original Adjudicating Authority for quantification of the demand falling within the limitation period. Appeal allowed by way of remand.
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