2023 (10) TMI 65 - SCH - Service Tax

Wrongful levy of service tax - HELD THAT - In the pending case as on interim measure, the concerned appellant (tenant) was directed to furnish bank guarantee qua the sum involved subject to which, the impugned judgment of the High Court was stayed. Issue notice returnable in six weeks.

Summary

Issues involved: Liability of service tax on renting of immovable property for commercial purpose, reliance on previous judgment, interim measure of furnishing bank guarantee, stay on High Court judgment.

The Supreme Court heard the petitioner's counsel who argued that the High Court wrongly imposed the liability of service tax on the Bank (tenant) instead of the landlord who provided the service. The petitioner contended that the Bank is already paying service tax for services provided to their customers. The counsel also pointed out the error in the High Court's reliance on a previous judgment which was under challenge in the Supreme Court.

In response to the pending case, an interim measure was taken where the appellant (tenant) was directed to provide a bank guarantee for the specified amount, leading to a stay on the High Court's judgment. The Supreme Court issued notice returnable in six weeks and subject to the deposit of the quantified sum of Rs. 27,87,374 for the entire service tax, the operation of the High Court judgment was stayed.