2018 (8) TMI 897 - AT - Service Tax

Extended period of limitation - Renting of Immovable Property Service - Held that - Hon ble High Court of Delhi in the case of Home Solutions Retails (India) Limited 2009 (4) TMI 14 - DELHI HIGH COURT held that renting of immovable property is not a taxable service, therefore, the extended period of limitation is not invokable in the facts and circumstances of the case. The demand pertains to extended period of limitation is set-aside, consequently, no penalty is imposable on the appellant - appellant is directed to pay the amount of service tax along with interest for normal period - appeal allowed in part.

Summary

Issues:
1. Confirmation of service tax demand under 'Renting of Immovable Property Service' for a specific period.
2. Invoking the extended period of limitation for the demand.
3. Dispute regarding the invocability of the extended period of limitation.
4. Legal precedent regarding the taxability of renting of immovable property.
5. Setting aside the demand and penalty imposition.

Confirmation of Service Tax Demand:
The appellant appealed against an order confirming the demand of service tax with interest under the category of 'Renting of Immovable Property Service' for a specific period. The appellant did not dispute the levy of service tax but contested the invocation of the extended period of limitation.

Invoking the Extended Period of Limitation:
The appellant argued that the extended period of limitation should not be applicable, citing a decision of the Tribunal in a similar case. The appellant's counsel contended that the extended period of limitation was not justifiable in this instance.

Dispute Regarding Extended Period of Limitation:
Considering a previous decision by the Hon'ble High Court of Delhi that renting of immovable property is not a taxable service, the judge held that the extended period of limitation was not applicable in the present case. Therefore, the demand related to the extended period of limitation was set aside, leading to no penalty imposition on the appellant.

Legal Precedent on Taxability of Renting of Immovable Property:
The judgment referred to a case where the High Court ruled that renting of immovable property is not a taxable service, influencing the decision to reject the invocation of the extended period of limitation in the current matter.

Setting Aside Demand and Penalty Imposition:
As a result of the above analysis, the demand linked to the extended period of limitation was annulled, and no penalty was imposed on the appellant. The appellant was directed to pay the service tax amount with interest within 30 days, warning of potential penalties under Section 76 of the Finance Act, 1994 for non-compliance.

Conclusion:
The appeal was disposed of with the decision to set aside the demand and not impose any penalty, emphasizing the non-applicability of the extended period of limitation based on legal precedents and interpretations of taxability in renting of immovable property services.