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2015 (8) TMI 1248 - AT - Service TaxRenting of Immovable Property Service - Valuation - Inclusion of notional interest - Penalty u/s 77 - Held that:- Appellants have received a huge sum of Rs, 20 crores, interest free as security deposit at the time of execution of the agreement. The monthly rental fixed is so nominal in regard to the property that is leased. Again, the renewal terms of the agreement are that the agreement can be renewed up to 20 years. If renewed to such extended period, the refund of the security deposit need to be made only after 20 years. But as to the rate of rent, it is specifically stated that the rent shall not be revised or enhanced even if the agreement is renewed for extended periods. Further, there is a lock-in-period of 5 years whereby the appellant is assured to retain the deposit for a period of 5 years even in the event of the Lessee/ GSPL terminating the agreement prior to the expiry of 5 years. The judgments rendered in K. Raheja Corp. (P) Ltd. [2015 (2) TMI 886 - CESTAT MUMBAI] and Murli Realtors Pvt. [2014 (9) TMI 461 - CESTAT MUMBAI] where the Tribunal has held that notional interest on interest free security deposit cannot be added to the rent agreed between the parties for the purpose of levy of service tax on renting of immovable property, is not applicable to the present case. The facts of the instant case stands on a different footing for the reason that the security deposit is very huge and the rent fixed is reduced to a nominal amount in regard to the property leased - the appellants have not been able to make out a case for full waiver of pre-deposit - stay granted partly.
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