2024 (5) TMI 1276 - AT - Service Tax

Renting of Immovable Property Services or business support service - Service tax on the amount retained for allowing use of infrastructure by contracted doctors - Confirmation of demand for renting of immovable property to specialized clinics/agencies - Service tax on miscellaneous receipts - HELD THAT - In view of the categorical findings recorded by the Tribunal in Sir Ganga Ram Hospital 2018 (8) TMI 249 - CESTAT NEW DELHI , the findings recorded in the impugned order that the appellant provided renting of immovable property‟ service cannot be sustained and will have to be set-aside. Regarding the miscellaneous receipts‟, the Commissioner (Appeals) has remanded the matter to the adjudicating authority to decide the issue on the basis of documentary evidence. This part of the order passed by the Commissioner (Appeals) does not call for any interference in this appeal. The impugned order dated 15.02.2018 passed by the Commissioner (Appeals) is set-aside to the extent it upholds the order of the adjudicating authority confirming the demand of service tax under business support service and renting of immovable property‟ service. The remaining part of the order by which the Commissioner (Appeals) has remitted the matter to the adjudicating is maintained. Consequently, the penalties imposed on the appellant cannot be sustained and are set-aside. The appeal is accordingly allowed to the extent indicated above.

Issues Involved:
1. Service tax on the amount retained for allowing use of infrastructure by contracted doctors.
2. Confirmation of demand for renting of immovable property to specialized clinics/agencies.
3. Service tax on "miscellaneous receipts."

Summary:

1. Service Tax on Amount Retained for Allowing Use of Infrastructure by Contracted Doctors:
The Tribunal examined whether the appellant was liable to pay service tax on the amount retained for allowing use of infrastructure by contracted doctors. The Tribunal referred to its decision in Sir Ganga Ram Hospital vs. Commissioner of Service Tax, New Delhi, where it was held that such arrangements are for the joint benefit of both parties with shared obligations, responsibilities, and benefits. The Tribunal concluded that the retained amount was for providing healthcare services and not for "business support services" u/s 65 (104c) of the Finance Act, 1994. Therefore, the Commissioner (Appeals) was not justified in confirming the demand of service tax under "business support service."

2. Confirmation of Demand for Renting of Immovable Property to Specialized Clinics/Agencies:
The Tribunal also examined whether the appellant provided "renting of immovable property" service to specialized clinics/agencies. Referring to its decision in Sir Ganga Ram Hospital, the Tribunal noted that the agreements with diagnostic centers did not involve any element of rent. The diagnostic centers were allowed to install and operate their equipment within the hospital premises, and the appellant employed its staff for billing and receiving payments. The Tribunal held that the findings of the Commissioner (Appeals) that the appellant provided "renting of immovable property" service could not be sustained and set aside this part of the order.

3. Service Tax on "Miscellaneous Receipts":
Regarding the "miscellaneous receipts," the Commissioner (Appeals) had remanded the matter to the adjudicating authority to decide the issue based on documentary evidence. The Tribunal found no reason to interfere with this part of the order.

Conclusion:
The impugned order dated 15.02.2018 passed by the Commissioner (Appeals) was set aside to the extent it upheld the order of the adjudicating authority confirming the demand of service tax under "business support service" and "renting of immovable property" service. The part of the order remitting the matter concerning "miscellaneous receipts" to the adjudicating authority was maintained. Consequently, the penalties imposed on the appellant were also set aside. The appeal was allowed to the extent indicated.

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