2016 (4) TMI 1371 - AT - Service Tax

Renting of immovable property - renting of property to M/s. Royal Orchid Banjara Pvt. Ltd., who are running a hotel on the said premises - scope of which excludes the buildings used for purposes of accommodation, including hotels - HELD THAT - The issue stand decided in the appellant's own case for the prior period in . 2014 (10) TMI 872 - CESTAT NEW DELHI . where it was held that Demand set aside - appeal allowed - decided in favor of appellant.

Summary

Issues: Service tax liability on renting of immovable property.

Analysis:
1. The appellant was confirmed a service tax liability of ?63.64 lakhs for renting out property to a hotel. The appellant claimed exclusion based on the property being used for accommodation, including hotels. However, lower authorities rejected the claim, stating the property was also used for other services like restaurants and swimming pools. The tribunal referred to a previous decision in the appellant's favor, where a similar demand was set aside based on the exclusion clause for properties used for accommodation. The tribunal followed the precedent set in the case of Jai Mahal Hotels Pvt. Ltd. v. CCE, Jaipur, to allow the appeal and provide consequential relief to the appellant.

2. The tribunal found in favor of the appellant based on the precedent decision in their own case, where a similar service tax liability was set aside. By following the earlier decision and the precedent set in Jai Mahal Hotels Pvt. Ltd. case, the tribunal set aside the impugned order and granted relief to the appellant. The decision was made after considering the arguments put forth by both sides and the established legal principles governing the exclusion clause for properties used for accommodation purposes.