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TMI Blog2023 (10) TMI 498X X X X Extracts X X X X X X X X Extracts X X X X ..... five appeals is as to whether the Department could have charged service tax on the notional interest towards security deposit taken by the appellant against the renting of safe deposits and private lockers. 2. It is not in dispute that the appellant has paid service tax on the amount of rent received by the appellant. The period involved in all the five appeal ranges from April, 2006 to March, 2012. 3. It transpires from the records of the appeals that the appellant had rented out lockers and apart from the rent, on which service tax was paid by the appellant, the appellant also collected interest fee security amount, which amount was required to be refunded when lockers were vacated. 4. The Department believed that the notional interest ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ded or to be provided. Learned counsel also placed reliance upon a Division Bench decision of the Tribunal in Murli Realtors Pvt Ltd vs. Commissioner of Central Excise, Pune-III [2015 (37) S.T.R. 618(Tri.-Bom) [16-07-2014]]. 7. Shri S.K. Meena, learned authorized representative appearing for the department has however supported the impugned order passed by the Commissioner (Appeals) and has submitted that it does not call for any interference. 8. The submissions advanced by learned counsel for the appellant and the learned authorized representative appearing for the department have been considered. 9. Section 67 of the Finance Act, as stood at the relevant time, reads as follows: "67 (1) Subject to the provisions of this Chapter, servi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... postal remittance and other similar instruments but does not include currency that is held for its numismatic value; (c) "gross amount charged" includes payment by cheque, credit card, deduction from account and any form of payment by issue of credit notes or debit notes and 1 book adjustment, and any amount credited or debited, as the case may be, to any account, whether called "Suspense account" or by any other name, in the books of account of a person liable to pay service tax, where the transaction of taxable service is with any associated enterprise." 10. A Division Bench of this Tribunal in Murli Realtors, while examining a similar issue, observed as follows: "6.1 Section 67 of the Act, reproduced in para 4.1 above, clearly prov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... provision in law providing for a notional addition to the value/price charged, the question of adding notional interest on the security deposit as a consideration received for the services rendered cannot be sustained and we hold accordingly." (emphasis supplied) 11. A perusal of the aforesaid decision of the Tribunal reveals that since the consideration for leasing of the property is rent, so what can be levied to service tax is only rent and notional interest on the security deposit cannot be subjected to levy of service tax. 12. In view of the aforesaid decision of the Tribunal, it has to be held that service tax could not have been levied on the notional interest calculated by the department on the interest fee security deposit col ..... X X X X Extracts X X X X X X X X Extracts X X X X
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