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TMI Blog2017 (4) TMI 1136X X X X Extracts X X X X X X X X Extracts X X X X ..... (IHCL) and which allowed the IHCL to use their premises for running hotel business. They received consideration in the form of percentage of gross income + gross operational profit or minimum guaranteed profit. The Revenue entertained a view that the appellant have provided taxable services under the category of "renting of immovable property services" and accordingly, proceedings were initiated to demand and recover service tax from the appellant. The case was adjudicated by the Original Authority vide order dated 30.07.2012. A demand of Rs. 29,13,947/- was confirmed against the appellant. On appeal, vide the impugned order dated 31.12.2013, the Commissioner (Appeals), upheld the original order. 2. Ld. Counsel for the appellant submitted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rent out a building for hotel. He supported the findings regarding service tax liability of the appellant. 4. We have heard both the sides and perused the appeal records. 5. We note that the appellants have categorically stated in their appeal that they are owners of the land measuring 7 acres along with buildings, structures situated in the said land. They have agreed to permit IHCL to use the aforesaid land, building and structures for the purpose carrying out the business of hotel. Hence, it is apparent that it is not the case of the renting out empty land to be later developed with construction of hotel. In any case, we find the allegation in the show cause notice also brings out that the agreement is to develop, expand, run and opera ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... used for the purpose 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 shall be deemed to be immovable property for use in the course or furtherance of business or commerce." 6. The appellants claimed exclusion under the category of buildings used for the purpose of accommodation including hotels. Admittedly, the building and the land as appurtenant thereto are used for the purpose of running the hotel. The term "hotel" is not defined in the Finance Act, 1994. As generally understood, a hotel is for temporary accommodation of people pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se of accommodation, including hotels. 7. On a true and fair construction of the relevant provisions of the exclusionary clause adverted to above, the interpretation is compelling that buildings used for or as hotels do not amount to immovable property. The legislative provision in question i.e. the exclusionary clause (d), to the extent relevant and material, excludes from the purview of immovable property, buildings used for the purposes of accommodation including for hotels." 8. Similar ratio has been followed in The Lake Palace Hotel and Motels Pvt. Ltd. - 2016-TIOL-2140-CESTAT-DELHI. Considering the discussion as recorded above and the decisions of the Tribunal in similar cases, we find that the impugned order is not sustainable. A ..... X X X X Extracts X X X X X X X X Extracts X X X X
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