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TMI Blog2017 (4) TMI 1087X X X X Extracts X X X X X X X X Extracts X X X X ..... e to service tax. No analysis was made with break-up figures with reference to commercial or non-commercial property, valuation of taxable service, abatement or exemptions, if any, applicable to the appellant etc. The tax liability has been confirmed against the appellant for receipts w.e.f. 01/06/2007 considering all such receipts under the category “land premia”. As already noted, we are of the view that the impugned order suffers from serious legal and factual infirmities due to non-examination of various relevant facts and also non-consideration of various legal issues before arriving at the tax liability of the appellant. The impugned order as its stand cannot be legally upheld. As already noted, it suffers from serious factual and legal infirmities and non-application of mind, both on the question of determination of tax liability as well as on quantification of such tax liability. Accordingly, we are of the considered opinion that the impugned order has to be set aside and the matter has to go back to the Original Authority for a fresh decision - appeal allowed by way of remand. - Service Tax Appeal No.58914 of 2013 with Stay Application No.59563 of 2013 - ST/A/53021/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n and other activities undertaken by appellant either on their account or assigned to them ; (b) Nazul I relates to transaction of old Nazul Estates entrusted to the appellant under Nazul Agreement, 1937 in which the appellant had succeeded Delhi Improvement Trust ; (c) Nazul II account relates to large scale land acquisition development and disposal activities. GDA is prepared in the common format of accounts prescribed for central autonomous bodies. Nazul I and Nazul II accounts gave details of transactions on Government account. 4. On conclusion of the enquiry and audit of records of the appellant, the Revenue proceeded to initiate action to demand and recover service tax under the taxable category of renting of immovable property service in respect of incomes shown under the heads sale value of developed land , sale value of undeveloped land and sale value of shops . 4 different demand notices were issued to the appellant covering the period from 01/04/2005 to 31/03/2012. Except for demand notice dated 31/08/2010, which also had demand under the tax entry club or association service , all demands are towards renting of immovable property service only. The appe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... same has been made in the impugned order ; (e) details of various receipts under specific headings were submitted in chart form. It is argued that no analysis of the nature and scope of receipt and liability of such receipt to service tax has been made in the impugned order. Out of total demand of about ₹ 949 crores, about ₹ 758 crores is attributable to the period 01/06/2007 to 30/06/2010, towards income from vacant land not covered for tax liability, prior to 01/07/2010. Similarly, demand of about ₹ 85 crores is attributable to income from non- commercial land which is not liable to tax. There is no consideration or analysis of these details, in the impugned order. (f) The service tax demands invoking extended period were contested on the question of time bar. The appellant is a organization of the Government and, as such, no allegation of fraud, willful mis-statement etc. with an intention to evade service tax can be made against them. There could be no malafide in not discharging service tax by a Government organization. Admittedly, the service tax liability under the category of renting of immovable property has been a subject matter of persistent lit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e tax. 7. Regarding non-consideration of various submissions and documents submitted by the appellant at the time of adjudication, the learned Senior Standing Counsel for Revenue submitted that the appellants were called upon to submit the relevant documents and details, repeatedly. On their failure to provide necessary document, the Revenue proceeded, based on the details on record and by invoking the provisions of Section 72 of the Finance Act, 1994 for arriving at the assessment based on best judgment. 8. We have heard both the sides carefully and also examined the appeal records including various written submissions made by the parties. The tax liability of the appellant is with reference to provisions of Section 65 (105) (zzzz) of the Finance Act, 1994. The statutory provisions as applicable during the disputed periods are as below :- 01/06/2007 to 30/06/2010 Taxable service means any service provided or to be provided to any person, by any other person, by renting of immovable property or any other service in relation to such renting of immovable property for use in the course or, for furtherance of, business or commerce.] Explanation 1. - For the purpose ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d (iv) in case of a building located in a complex or an industrial estate, all common areas and facilities relating thereto, within such complex or estate, (v) vacant land given on lease or license for construction of building or temporary structure at a later stage to be used for furtherance of business or commerce. but does not include - (a) vacant land solely used for agriculture, aquaculture, farming, forestry, animal husbandry, mining purposes; (b) vacant land, whether or not having facilities clearly incidental to the use of such vacant land; (c) land used for educational, sports, circus, entertainment and parking purposes; and (d) building used solely for residential purposes and buildings used for the purposes of accommodation, including hotels, hostels, boarding houses, holiday accommodation, tents, camping facilities. Explanation 2. - For the purposes of this sub-clause, an immovable property partly for use in the course or furtherance of business or commerce and partly for residential or any other purposes shall be deemed to be immovable property for use in the course or furtherance of business or commerce; - Section 65 (105) (zz ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d let out for schools or other non-commercial establishments. There is no discussion or finding by the Original Authority regarding non- commercial or commercial nature of the property let out by the appellant. In fact, considering the huge quantum of service tax demand of ₹ 950 crores confirmed against the appellant, we would expect a detailed analysis of factual as well as legal position, before the conclusion was drawn by the Original Authority. The analysis and discussion recorded in the impugned order is rather brief. After reproducing the statutory definitions, the Original Authority has concluded that the appellant is liable to service tax. No analysis was made with break-up figures with reference to commercial or non-commercial property, valuation of taxable service, abatement or exemptions, if any, applicable to the appellant etc. The observation of the Original Authority in this regard is as below :- 22.11 I further find that the DDA is a premier agency not only engaged in development of land/building etc. but also providing various services to their customers. I find that there is a specific mention in the show cause notice that party was asked to provide requ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nance Act, 1994 they during the course of adjudication proceedings has also neither provided complete details of their receipts from different heads nor given cogent reasons to show that the liability arrived at by the department is not sustainable. In such circumstances, I have no option but to proceed for arriving at the service tax liability of the noticee for the period under dispute on the basis of the best judgment assessment as provided under Section 72 of the Finance Act, 1994 on the basis of material available on record. Accordingly, I confirm he veracity of the liability arrived at by the department as the same cannot be held against the statutory provisions of the service tax law and I hold it accordingly . 12. During the course of arguments before us, the appellants submitted various tabulated charts giving split up figures, periodwise, under various heads of income. They have also submitted copies of conveyance deeds for transfer of free hold ownership rights of the property. We have perused some of the conveyance deeds and we note that the appellant s claim is to the effect that these are actually for transfer of free hold ownership of lands (sale) and not lease a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Section 72 has two clauses (a) and (b). It is not clear under what category the appellant s case was considered for invoking the said provision. The appellants made submission with detailed break up figures under various heads of income. (f) consideration of service tax already paid, including under voluntary compliance scheme, not examined for a finding. 14. The appellant s plea regarding non-sustainability of demand for extended period in terms of proviso to Section 73 (1) of the Finance Act, 1994 also has not been dealt with in proper prospective by the Original Authority. The Original Authority sustained the demand for extended period on the ground that the tax entry under the category of renting of immovable property was introduced and widely publicized by the Department. It was held that non-payment of service tax cannot be termed as bonafide lapse. Appellant never informed the Department about the receipt of taxable amount and suppressed the fact with an intention to evade payment of service tax. Accordingly, the Original Authority concluded that they have deliberately contravened various provisions of law and rules with intend to evade payment of service tax. We fi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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