2014 (7) TMI 31 - AT - Service Tax

Waiver of pre-deposit - nature of amount received - renting of immovable property services - Revenue contends that appellant had stated that agreement entered by appellant is not for renting of immovable properties but is for a business consideration / conducting and would not fall under the category of renting of immovable properties - Held that - facts in this case are the agreements though contended by the appellant were for arrangement of business conducting and amenities agreement, prima facie, in our view the said agreement may fall under the category of renting of immovable property services. Coming to the submissions made by the Ld. Counsel as to bonafide belief, this needs to be gone into detail which in our view can be done by us at the time of final disposal of appeals. Be that as may be, by the retrospective amendment brought in by Finance Act, 2010, it can be presumed that the appellant was aware of the service tax liability atleast from that date. Keeping in mind appellant has deposited an amount of Rs.14.83 lakhs during the pendency of the proceedings before the lower authorities and prima facie holding that the appellant has not made out a case for complete waiver of the balance amounts involved, and as the issue is an arguable one, we are of the view that appellant should be put to further condition of depositing an amount - Conditional stay granted.

Summary

Issues: Stay petition for waiver of pre-deposit of service tax liability, interest, and penalties under renting of immovable property services.

Analysis:
1. The appellant filed a stay petition seeking waiver of pre-deposit of Rs.69,16,233/- confirmed as service tax liability, interest, and penalties under renting of immovable property services from June 2007 to March 2012. The appellant argued that the agreement was not for renting immovable properties but for business consideration, disputing the liability to pay service tax on renting of immovable properties. The appellant had already deposited Rs.14,82,278/- during the proceedings.

2. The Additional Commissioner argued that the appellant cannot deny renting out premises as the agreement specified charging per square feet, indicating awareness of renting immovable properties. The issue of bonafide belief was raised, and it was contended that the appellant cannot claim such belief.

3. The Tribunal considered the submissions and records. It noted that while the agreements were for business conducting and amenities, they could prima facie fall under renting of immovable property services. The issue of bonafide belief required further examination, especially in light of the retrospective amendment by the Finance Act, 2010, indicating awareness of service tax liability. The Tribunal found that the appellant had not made a case for complete waiver of the balance amounts, considering the arguable nature of the issue.

4. Consequently, the Tribunal ordered the appellant to deposit an additional amount of Rs.10,00,000/- within eight weeks and report compliance. Upon compliance, the application for waiver of pre-deposit of balance amounts was allowed, and recovery stayed until the appeal's disposal. The final orders were to be passed after verifying compliance on the specified dates.

This detailed analysis of the judgment highlights the arguments presented by both parties, the Tribunal's evaluation of the issues raised, and the conditions imposed for the waiver of pre-deposit and stay of recovery pending appeal disposal.