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2021 (4) TMI 819 - HC - Service TaxLevy of Service Tax - fees collected by the University - petitioner had been collecting affiliation fees, inspection fees and other fees etc. from the affiliated colleges and charges by way of renting of immovable properties - demand of interest and penalty as well - Circular No.89/7/2006-ST dated 18.12.2006 issued by the Government of India, Ministry of Finance, Department of Revenue, Central Board of Excise and Customs - HELD THAT:- There can be no doubt that a college as per the UGC regulations will have to be affiliated to some University. Therefore, the affiliation fees as well as the inspection commission collected by the University are in the nature of statutory levies. By performing those activities, the petitioner is only discharging a statutory function and the fees collected by the petitioner cannot be amenable to levy of Service Tax. It is true that authorisation is given to the University to maintain the property. But then, there is clear commercial element in these transactions. The University is renting the property to other institutions and collecting rent from them. Therefore, the second respondent was justified in raising demand for the said service. There is no justification in levying penalty - Appeal allowed in part.
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