ST - JNPT had given land on lease in year 1993 to Ganesh Benzoplast and lease agreement was renewed in year 2004 - ST demanded - Prior to 01.07.2010, renting of vacant land is not covered under scope of Service Tax - stay granted: CESTAT
By TIOL News Service
MUMBAI, DEC 30, 2013: AGAINST an o-in-a, the applicant has filed an application before the CESTAT for waiver of pre-deposit of service tax amount of Rs.11,89,402/- interest and penalty.
The demand is confirmed on the ground that applicant had provided‘Renting of Immovable Property Service'.
It is the submission of the applicant that they had given land on lease to M/s. Ganesh Benzoplast Ltd. in the year 1993 and the lease agreement was renewed in the year 2004. It is further submitted that it is only w.e.f. 1.7.2010 that even the vacant land given on lease or licence for construction of building or temporary structure at a later stage to be used for furtherance of business or commerce had come under the scope of service tax. Inasmuch as prior to 1.7.2010, renting of vacant land is not covered the scope of service tax, the applicant submitted. The applicants also informed the Bench that they are paying appropriate service tax w.e.f. 1.7.2010.
The Revenue representative reiterated the findings of the lower authority.
The Bench observed -
"5. We find that in the explanation to renting of immovable property service is added w.e.f. 1.7.2010 which provides that even the vacant land given or lease and licence for construction of building or temporary structure for use of commerce or business is covered under the scope of renting of immovable property service. Admittedly, the facts of the case that applicants are given only vacant land on lease prior to 1.7.2010. In view of this, prima facie we find that the applicant has a strong case in their favour. Therefore the pre-deposit of the remaining amount of service tax, interest and penalty is waived and recovery is stayed during the pendency of the appeal. The stay petition is allowed."
In passing: Extract from Finance Act, 2010 -
(h) in sub-clause (zzzz), -
(i) xxx
(ii) in Explanation 1, after item (iv), the following item shall be inserted, namely:-
"(v) vacant land given on lease or licence for construction of building or temporary structure at a later stage to be used for furtherance of business or commerce;";
(See 2013-TIOL-1926-CESTAT-MUM)
|