TMI Blog2014 (11) TMI 499X X X X Extracts X X X X X X X X Extracts X X X X ..... ey may recover separately. Therefore, the contention of the appellant as they have not recovered the service tax from the lessee, the rent recovered by them be treated as cum-service tax is not acceptable. In these circumstances, we hold that the rent received by the appellant shall be treated as gross value of taxable service and on the said amount the appellant is required to pay service tax. Levy of penalty - On the understanding of the appellant that what amount of rent they received the same is treatable as cum-service tax, therefore, they have not paid full amount of service tax. This understanding by the appellant is not acceptable. In these circumstances, substantial benefit of Section 80(2) cannot be denied. In these circumstanc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... herefore, penalties cannot be imposed. Adjudication took place and service tax was demanded on whole of the amount of security deposit and rent received from the lessee by the appellant and benefit of Section 80(2) was not given to the appellant. Aggrieved by the said order, the appellant is before us. 3. Heard both sides. 4. The learned Counsel appearing on behalf of the appellant submits that no service tax is payable on the security deposit received by the appellant from the lessee as the said amount is refundable at the time of termination of lease/rent agreement of the property. Therefore, the same does not form a part of services provided by the appellant. It is further submitted that the appellant was under bonafide belief that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , the said security deposit cannot form a part of service provided by the appellant. Therefore, on the said amount, service tax is not payable. We have examined the copy of the agreement produced before us by the appellant. As per the agreement, the service tax is payable separately by the lessee. As the appellant has not recovered service tax from the lessee, they may recover separately. Therefore, the contention of the appellant as they have not recovered the service tax from the lessee, the rent recovered by them be treated as cum-service tax is not acceptable. In these circumstances, we hold that the rent received by the appellant shall be treated as gross value of taxable service and on the said amount the appellant is required to pay ..... X X X X Extracts X X X X X X X X Extracts X X X X
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