TMI Blog2023 (10) TMI 1166X X X X Extracts X X X X X X X X Extracts X X X X ..... ion of Division Bench of this Tribunal in Murli Realtors [ 2014 (9) TMI 461 - CESTAT MUMBAI] 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. Thus, 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 collected by the appellant from tenants. The orders impugned in the four orders passed by the Commissioner (Appeals) that have been assailed in the four appeals cannot be sustained - Appeal allowed. - HON BLE SHRI JUSTICE DILIP GUPTA , PRESIDENT And HON BLE P. V. SUBBA RAO ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or the provision of a service. The reply filed by the appellants was not accepted by the department and the demands raised in the show cause notices were confirmed. Feeling aggrieved, the appellants filed appeals before the Commissioner (Appeals). The Commissioner (Appeals) has dismissed all the appeals and upheld the order passed by the Adjudicating Authority. 4. Ms. Priynaka Goel, learned counsel appearing for the appellant has contended that the advances received by the appellants are in the shape of interest free security deposit and has no impact on the rental charges collected by the appellant. Thus, the amount of notional interest cannot be considered as a consideration. In support of this contention, learned counsel placed relian ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rvice is for a consideration which is not ascertainable, be the amount as may be determined in the prescribed manner. (2) Where the gross amount charged by a service provider, for the service provided or to be provided is inclusive of service tax payable, the value of such taxable service shall be such amount as, with the addition of tax payable, is equal to the gross amount charged. (3) The gross amount charged for the taxable service shall include any amount received towards the taxable service before, during or after provision of such service. (4) Subject to the provisions of sub-sections (1), (2) and (3), the value shall be determined in such manner as may be prescribed. Explanation.-For the purposes of this sect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d to the leased property. Thus, the security deposit serves a different purpose altogether and it is not a consideration for leasing of the property. The consideration of the leasing of the property is the rent and, therefore, what can be levied to Service Tax is only the rent charged and no notional interest on the security deposit taken can be levied to tax. There is no provision in Service Tax law for deeming notional interest on security deposit taken as a consideration for leasing of the immovable property. Therefore, in the absence of a specific provision in law, as held by the Hon'ble Apex Court in the case of Moriroku UT India (P) Ltd. (supra), there is no scope for adding any notional interest to the value of taxable service re ..... X X X X Extracts X X X X X X X X Extracts X X X X
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