TMI Blog2018 (12) TMI 1112X X X X Extracts X X X X X X X X Extracts X X X X ..... nage and operate the club for their mutual benefit, on principle to principle basis. Refund claim - time limitation - Held that:- there is no application of Section 11 B of the Central Excise Act in grant of refund, in the facts of the present case following the precedent ruling in the case of Union of India Vs. ITC Ltd. – [1993 (7) TMI 75 - SUPREME COURT OF INDIA]. A tax wrongly realized or paid on in excess of what is permissible in law, is a realization made outside the provisions of the Act. Such amount cannot be retained by Revenue, being in conflict with Article 265 of the Constitution. Appeal allowed - decided in favor of appellant. - APPEAL Nos.ST/57835/2013-DB - FINAL ORDER No.53429/2018 - Dated:- 17-12-2018 - Mr. Anil Choudhary, Member (Judicial) And Shri C.L. Mahar, Member (Technical) Shri P.K. Sahu, Advocate for the Appellants. Shri A.K. Singh, DR for the Respondent. ORDER Per Anil Choudhary The brief facts of the case are that the appellant vide Agreement of Sale/Purchase dated 8.12.2003 with Ansal Properties Ind. Ltd., acquired possession of club building with the land apartment thereto (in bare shell condition) located at Bloc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ant memberships from the execution of this Agreement. The First Party further agrees to take all appropriate actions required to assure such quiet and peaceful operation and maintenance by the Second Party. 3.4 The Second Party will arrange for the requisite Working Capital, as provided for in Clause 10.2, necessary to enable the Second Party to operate and maintain the Club. 3.5 The Second Party warrants to the First Party that it has the technical knowledge and expertise required for the operation, management and maintenance of a first class private club. 5.3 All Pre-Opening Expenses shall be borne and met by the Second Party (AMPL). Such pre-opening expenses shall include but not be restricted to pre-opening salaries and wages, training expenses, food trial expenses, promotional and advertising expenses including cost of promotional material, cost of licenses and permits required for operations, cost of opening functions and parties. 6.1 This Agreement shall become effective from the date of its execution. The initial Term of Agreement shall be for a period of twenty five (25) years commencing on the date of handing over of possession of the Club. 7 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hereafter, Membership opened in April, 2005 and club starting functioning club was granted liquor licence in July, 2005. 4. That vide Supplemental Agreement date 17.03.2007, between Appellant AHPL and AMPL, some terms of J.V were modified, particularly as to Sharing of Revenue . Clause 9 of 9.0 Agreement was substituted as follows. 7.1 The Parties agree to amend Clause 9 of the Joint Venture Agreement by substituting it with the following clause: In consideration of AHPL collaborating with the Company for management of the Club pursuant to this Agreement, the Company agrees to pay the following consideration to AHPL; a. ₹ 1,45,00,000/- shall be paid by the Company to AHPL for the period 1st April, 2005 to 31st March, 2006 in the manner as decided mutually between the parties. However, with effect from 1st April, 2006, ₹ 18,00,000/- per month shall be paid by the Company by way of lease rental on monthly basis and for this purpose, the parties shall enter into a lease deed for the lease of the Club Premises. b. ₹ 2,00,000/- per month shall be paid by the Company in consideration of AHPL providing all the initial kitchen equipments, furni ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o its members and their guests and for this purpose the remuneration was not enough, but the membership of club was also essential, whereas in the case of a hotel, the services are available to everyone who pays remuneration for it and hence in the instant case, the club was not akin to a hotel. It was also held that part of refund claim was barred by limitation. 8. Appellant have filed their appeal before this Tribunal on the ground that the club did not fall in the definition of immovable property and that the claim was not barred by limitation. In the application for additional grounds of appeal, it has been submitted that the appellant has given the club as a running business (Joint Venture) and that, the service tax was not payable on running of business, or running the club in Joint Venture. 9. The Ld. Counsel for the Appellant submits that Renting of Immovable Property was brought into service tax net by Finance Act 2004 w.e.f. 01-06-2007 under section 65 (105) (zzzz) which reads as under Section 65 Definitions-In this chapter, unless the context otherwise requires- (90a) renting of immovable property includes renting, letting, leasing, licensing or other si ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e in as much as it is not in dispute that club provides the rooms available for stay of its members and for their guests. It may be held that facilities provided by the club were akin to the facilities provided by the hotel. 11. Ld. Counsel places reliance in the case of M/s Spun Casting Engg. Co. Pvt. Ltd. vs Dwijendra Lal Sinha (Dead) reported in (2005) 6 SCC 265 and K.V. Jai Singh vs. C.R. Govindaswamy Chettiar (1996) 4 SCC 761. In both the cases the court had been analyzing provisions relating to Rent Control Act. It had been observed that Renting of Immovable Property was different than Leasing of Business itself. In support of the contention that it is a case of Leasing of Business and not the leasing of Immovable property, appellants submitted copies of the liquor licence dated 21.07.2005, which had been granted to the appellant and was being used by the lessee or co-venturer. Appellant also submitted a list of members who became the members of club prior to the said lease deed dated 10.3.2004 and continued to be the members of club even afterwards; they enjoyed the facilities of the club. It is therefore clear that it was a case of leasing of business and not the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... agreed rental charges to the First Party by the fifteenth day of each next English Calendar Month. In case of delay in payment of rent by the Second Party an interest calculated @12% p.a. shall be paid by the second party to the First Party for the period of delay. 16. Thus, it is evident that the appellant, AHPL was receiving monthly rental of ₹ 18 lakhs from AMPL being the agreed rental charges per month. Further, referring to the provisions of Joint Venture Agreement dated 10.03.2004, he states that it is evident that club was yet to be built and developed. Hence, the appellant s contention that the running of club was handed over to AMPL is not proved. 17. Further, Ld.AR referring to para-7.1 (b) of the Supplemental Agreement dated 17.03.2007 states that it is abundantly clear that 50% of the amount i.e. ₹ 1 lakh was being paid to AHPL for the kitchen equipments and another 50% i.e. ₹ 1 lakh was being paid for the furniture, fixtures and fittings, which includes several items as per Appendix-A of the Joint Venture Agreement. Thus, ₹ 18 lakhs mentioned in Clause 7.1 (a) of the Supplemental Agreement or ₹ 18 lakhs p.m. was being paid by way ..... X X X X Extracts X X X X X X X X Extracts X X X X
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