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Issues involved: Determination of whether the appellant's activities constitute Support Service for Business or Commerce, liability to pay service tax, challenge to the quantification of service tax liability, and the applicability of the 'pure agent' concept.
Issue 1: Classification of Services The appeal centered on whether the appellant's actions fell under Support Service for Business or Commerce. The appellant had constructed a building on leased land, leased out parts of it, and collected charges from tenants for facilities provided by Technopark. The Revenue contended that collecting and paying these charges constituted Business Support Services, leading to a demand for service tax and penalties under the Finance Act, 1994 for the period from 1.5.2006 to 31.3.2010. Issue 2: Applicability of Service Tax The appellant argued that they were only providing renting of immovable property services and paying service tax for it. They claimed that the charges collected for facilities like water and electricity were akin to a sale of goods, or at most, an activity as a pure agent based on agreements with Technopark. They also disputed the quantification of the service tax liability accepted by the Commissioner. Issue 3: Nature of Charges The Revenue countered that the charges were not solely for water and electricity but were based on the area occupied by tenants, making it distinct from a sale of goods. They argued that the appellant's 'pure agent' defense was not raised earlier and lacked evidence of only collecting actual costs. The department maintained that the charges covered various services beyond electricity and water, such as campus maintenance and network facilities, supporting their claim of Business Support Services. Judgment: After reviewing the arguments, the Tribunal found it challenging to accept the appellant's assertion that the charges were solely for water and electricity due to being based on occupied area rather than actual consumption. The payments to Technopark encompassed services beyond utilities, strengthening the department's position of Business Support Services. Consequently, the appellant was directed to pre-deposit a specified amount for the appeal, with potential waiver and stay against recovery subject to compliance.
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