TMI Blog2017 (9) TMI 298X X X X Extracts X X X X X X X X Extracts X X X X ..... intenance is not sustainable. Lease rent - Held that: - According to agreement there is a lease rent fixed between the appellant as a lessor and the lessee. Therefore, the arrangement is nothing other than renting of immovable properties. The process of recovery of dues is in accordance with the SERFAESI Act, 2002 through rental income against the property of the defaulter of the loan of the appellant. There is no provision in the Finance Act, 1994 for granting any exemption in respect of receipt of service charges, which is towards the recovery of outstanding loan. Therefore, the arrangements of lease is squarely covered under the services of renting of immovable property - demand upheld. Appeal allowed - decided partly in favor of a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... judicating authority confirmed the demand of service tax on the service under the head of renting of immovable property. Therefore, the appellants are before us. 2. Shri Rajeev Waglay, learned Counsel appearing on behalf of the appellant submits that the rent received from the lessee is for recovery of dues from the borrower and this is permissible under the SERFAESI Act, 2002. Therefore, the same cannot be treated as service charges and accordingly they will not be liable to service tax. He further submits that the service tax was also demanded on the amount of repair and maintenance incurred by the lessee on the ground that the repair and maintenance was obligation of the appellant, therefore, the same is part and parcel of the gross v ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 016 (342( ELT A115 and Persistent System Ltd. - 2016 (45) STR 177 (Tri-Mum). He also submits that as regards the demand related to M/s.Raje Vijay Singh Dafale Sahakari Sakhar Karkhana Ltd. cum tax demand works out to ₹ 2,13,770/-. He also submits that since the issue involving interpretation of statutory provision, penalty under Section 76, 77 78 of the Finance Act, 1994 has to be set aside as held in the case of Oracle India Pvt. Ltd. - 2016 (342) ELT A40 (SC). 3. Ms. P. V. Shekhar, Ld. Jt. Commissioner (AR) appearing on behalf of the Revenue reiterates the findings in the impugned order. She further submits that irrespective of the fact whether the rent received by the appellant is against the recovery of outstanding du ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly, we set aside the demand related thereto. 4.1 On the second count the demand is as lease rent the submission of the appellant is that since the lease rent towards the recovery of outstanding dues, the same should not be taxed. We do not agree with the appellant's contention for the reason that admittedly there is a lease agreement between the appellant and the lessee. According to agreement there is a lease rent fixed between the appellant as a lessor and the lessee. Therefore, the arrangement is nothing other than renting of immovable properties. The process of recovery of dues is in accordance with the SERFAESI Act, 2002 through rental income against the property of the defaulter of the loan of the appellant. There is no provisi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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