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TMI Blog2020 (9) TMI 1303X X X X Extracts X X X X X X X X Extracts X X X X ..... nd penalty or recovery measures are under challenge in these writ petitions. Though the local bodies have been rendering "renting of immovable property service/mandap keeper service", they did not initially get themselves registered or pay the service tax for those services. That necessitated initiation of proceedings resulting in passing of the impugned orders. Questioning the same, these writ petitions have been filed. 2. The learned counsel appearing for the petitioners reiterated all the contentions set out in the affidavits filed in support of the writ petitions. Shri. Joseph Prabhakar the learned counsel for one of the petitioners led the arguments and also filed his written submissions. Since the stand of the respondents is that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al authority" was defined as follows : "governmental authority means a board, or an authority or any other body established with 90% or more participation by way of equity or control by Government and set up by an Act of the Parliament or a State Legislature to carry out any function entrusted to a municipality under Article 243 W of the Constitution." 3. The petitioners herein were admittedly discharging the functions entrusted under Article 243W of the Constitution of India. Obviously, they are governmental authorities. Therefore, they consequently qualify for exemption under Serial No.39 of the Mega Notification. The learned counsel relied on a catena of decisions in this regard. He would also state that the petitioners being local ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r licensee in respect of four contracts, wherein the petitioner has been given license to collect fees. Furthermore, the petitioner has not challenged the validity of the provisions of the Finance Act nor the notification issued by the second respondent and in such circumstances a challenge to a demand notice issued by the service provider under whom the petitioner is a licensee has to necessarily fail. Nevertheless, since this Court heard the learned counsel for the petitioner in great length, this Court proposes to consider the submissions made by the parties as regards the jurisdiction to levy the service tax. 14. Renting of immovable property was brought under the Act with effect from 01.06.2007. Section 65(105) (zzzz) defines taxabl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing services to the extent they are not covered elsewhere and the relevant clause would be Clause (iv) namely support services, other than services covered under Clauses (i) to (iii), provided to business entities. Therefore, the Municipality is bound to pay service tax on the nature of transaction, which they have entered into with the petitioner." 5. When the Division Bench of the Madras High Court has already held that the local bodies are also liable to pay service tax for rendering "renting of immovable properties" service/mandap keeper services etc., then, it is not for me to go into the issue once again. Judicial discipline demands that I respectfully follow these binding precedents. 6. Having noted that the petitioners are liable ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... had been specifically dealt with by the Division Bench of the High Court of Judicature of Chhattisgarh in the decision reported in 2019 (31) GSTL 10 (Chhattisgarh) (Pawan Engineering Works vs. Commissioner of Customs, Central Excise & S.T, Raipur). Paragraph No.10 of the said decision reads as under : "10. The contention of the appellant is that the extended period of 'five years' is not applicable to the instant case, as it does not come within the purview of specific Clauses at 'a, b, c, d and e'. This aspect has been considered by the Tribunal and it has been clearly held in paragraph 17 that non-registration of the appellant, in the given circumstances, definitely will amount to suppression of the relevant facts, which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ny malafide intention to evade payment of service tax. It is for this reason, the Tribunals throughout India have been taking a consistent stand in directing waiver of penalty. The respondent authorities are bound by the view taken by the jurisdictional Tribunal. Therefore, levying of penalty on the local body is clearly not warranted and they are accordingly set aside. 9. In the result, I hold as follows : (a)The petitioner are liable to pay service tax as demanded by the respondents together with interest. (b)The demands raised by the respondents are within time, and (c)The imposition of penalty on the petitioners is set aside. The writ petitions are partly allowed. No costs. Consequently, connected miscellaneous petitions are clo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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