TMI Blog2019 (4) TMI 1890X X X X Extracts X X X X X X X X Extracts X X X X ..... , map revision, malba charges, etc. would not attract Service Tax. It was also held that the rent/licence fee received by the appellant from their staff to whom the residential units has been let out, such letting out the residential units to the staff is not renting of immovable property for use in or for furtherance of business or commerce and hence, the licence fee/rent received from such letting out of houses of Noida Authority would not attract Service Tax. Demand set aside - appeal allowed - decided in favor of appellant. - Service Tax Appeal No. 52675/2015 - CU[DB] - Final Order No. 61236/2019 - Dated:- 3-4-2019 - Hon ble Mr. Ashok Jindal, Member (Judicial) And Hon ble Mr. C.L. Mahar, Member (Technical) For the Appellant : Dr. Prabhat Kumar, Advocate For the Respondent : Mr. Basha Ram, Authorised Representative ORDER PER C.L. MAHAR: The brief facts of the matter are that the appellant is a public sector undertaking primarily engaged in the development and sale of Industrial and residential plots (Sheds) on 99 years lease hold basis to different industrial units as well as individuals. The persons allotted with the plots/ sheds ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n seven equated installments. It is thus, impressed that the activity undertaken by the appellant is nothing but sale of plot on lease hold basis for the period of 99 years of lease and such a sale does not tantamount to renting of immovable property and therefore, the provisions of Finance Act, 1994 are not applicable in their case. It has further been stressed that the adjudicating authority could have seen it from the terms and conditions of allotment and conversions of same in to free hold, that it is very apparent that allottee is for all purposes defacto and dejure owner of the plot of land. The learned advocate appearing for the appellant submitted that CBEC in their Circular issued vide MF(DR) letter DOF No. 334/1/2008 TRU dated 29.02.2008 has clarified that no taxable event takes place in a case where there was transfer of right of possession or control of immovable property in favour of the person using such property. Thus, it was contended that no service tax is leviable on the activity undertaken by the appellant because of the fact that the allotment of the plots /sheds have a right of possession and control over such property. 3. It has further been conteste ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d is premium or salami, but the periodical payments for continuous enjoyment are in the nature of rent, the former is a Capital Income and the latter is the revenue receipt. Thus, the premium is the price paid for obtaining the lease of an immovable property. While rent, on the other hand, is the payment made for use and occupation of the immovable property leased. Since taxing event under Section 65(105)(zzzz) read with Section 65(90a) is renting of immovable property, Service Tax would be leviable only on the element of rent i.e. the payments made for continuous enjoyment under lease which are in the nature of the rent irrespective of whether this rent is collected periodically or in advance in lump sum. Service Tax under Section 65(105)(zzzz) read with Section 65(90a) cannot be charged on the premium or salami‟ paid by the lessee to the lessor for transfer of interest in the property from the lessor to the lessee as this amount is not for continued enjoyment of the property leased. Since the levy of Service Tax is on renting of immovable property, not on transfer of interest in property from lessor to lessee, Service Tax would be chargeable only on the rent whether it i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the rent received during period w.e.f. 1-7-2010 in respect of leases of vacant land for construction of buildings or temporary structures for commercial use during period prior to 1-7-2010 would not be taxable and in this regard, reliance is placed on Apex Court judgment in the case of Vazir Sultan Tobacco Co. Ltd. reported in 1996 (83) E.L.T. 3 (S.C.). The Apex Court in this case has held that the goods manufactured prior to levy of duty but cleared thereafter would not be liable to excise duty. This judgment does not help the Appellant, as the levy of Service Tax is on the event of provision of a taxable service, not on the event of entering into agreement for provision of service. Moreover, unlike manufacture of goods and clearance of manufactured goods which are one-time events, the provision of service in pursuance of an agreement for the same, may after starting the provision of service, continue for some time - for several days, several months or several years, depending on the terms of the agreement and in between, a service which at the time of initiating the provision of service was non-taxable may become taxable. Since the taxing event for Service Tax is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) has held that the extended period of five years for recovery of short paid, short levied or erroneously refunded duty under proviso to Section 11A(1) of Finance Act, 1994 would not be applicable for failure or negligence of the manufacturer to take out licence or to pay duty when there was scope for doubt that the goods were dutiable or not, that the extended period under proviso to Section 11A(1) is applicable only when there is something positive other than mere inaction or failure on the part of the manufacturer or producer or conscious or deliberate withholding of information when the manufacturer knew otherwise, or contravention of the provision of Central Excise Act, 1944 or of the Rules made thereunder with intent to evade payment of duty. It has also been observed that expression suppression of facts in proviso to Section 11A(1) is to be interpreted strictly because it has been used in the company of such strong words as fraud , collusion , wilful misstatement , and where the facts are known to both the parties. It is not the case of suppression of facts. The Apex Court in the case of Continental Foundation Joint Venture v. CCE, Chandigarh reported in 2007 (216 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... w cause notice dated 17-10-2012 issued by the Commissioner Central Excise and Service, Tax, Noida, demanding Service Tax of ₹ 1,40,74,64,321/- for the period May, 2007 to March, 2012. Though the order, dated 30-4-2013 passed by the Commissioner in respect of a show cause notice dated 17-10-2012, at one place mention that the Service Tax demand of ₹ 1,40,74,64,321/- confirmed by this order, does not include the Service Tax of ₹ 4,13,45,830/- demanded in the show cause notice dated 22-3-2012 issued by a ADG, DGCEI and adjudicated by the Order-in-Original dated 16-7-2012, from the order dated 30-4-2013, it is not at all clear as to whether the Service Tax demand confirmed vide Order-in-Original dated 16-7-2012 is not covered by this order. In this regard, Shri Amresh Jain, ld. DR, in his written submissions has also mentioned that though efforts at every level from the Range Superintendent to the Commissioner were made with the noticee to cooperate and submit the headwise figures but all in vain and without noticees‟ cooperation, it could not be ascertained at that stage as to whether the amounts included in the show cause notice dated 22-3-2012 issued by the A ..... 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