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TMI Blog2017 (5) TMI 240X X X X Extracts X X X X X X X X Extracts X X X X ..... ST/198/2012-DB ST/261/2012-DB Deepak K Patwa, Shrenik K Patwa, Sejal Patwa, Suchita Shah, Dilip Shah, Renuben Amitbhai Patel, Gitaben Kirtibhai Patel, Kirtibhai Mohanbhai Patel, Amishaben Sandipbhai Patel, Parimalbhai Champaklal Parekh, Sanjaybhai Champaklal Parekh, Pankajbhai Champaklal Parekh, Chinuben Jadia & Others, Bhavna R Shah, Nishaben G Shah, Dineshchandra V Patel, Tarun D Patel, Pushpaben D Patel, Shilpaben T Patel, Pratik D Patel, Kanubhai J Patel, Mukeshbhai C Shah, Nisargiben A Patel & Others, Atulbhai Babubhai Patel, Minaxiben J Thakker, Pushpaben J Thakker, Pritiben B Shah, Jitendrabhai R Thakker, Bharatbhai Ghanshyambhai Shah, Bharatbhai Ghanshyambhai Shah (huf), Jayantibhai P Thakker, Ghanshyambhai H Shah, Jagdishbhai Raychandbhai Thakker, Jagrutiben Jagdishbhai Thakker, Manju Champalal Bafna, Sukhidevi Manekchand Bafnan, Manekchand Devji Bafna, Sangeeta Mukesh Bafna, Sangeeta Mukesh Bafna, Vamini Nitinkumar Shah, Payal Birenkumar Shah, Jolly Chetankumar Kharidia, Sunilkumar Nandkishore Gupta, Nandkishore Onkarmal Gupta ORDER Per: Dr. D. M. Misra The above listed appeals filed against respective orders, since involve almost similar facts and common questions o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... andigarh-I 2017 (1) TMI 101 CESTAT Chandigarh, CCE Allahabad Vs Luxmi Chaurasia 2017 (2) TMI 105 CESTAT Allahabad. The learned Advocate vehemently argued that considering the co-owners as association of persons, the authorities below erred in confirming the demand by denying the benefit of Notification No.6/2005-ST, to individual co-owners who has been assessed to Income Tax individually on the rent income received from the joint property and the TDS at source has also been deducted separately. It is his contention that the Appellants have not been considered as association of persons for the purpose of Income Tax assessment nor any association has been formed by the co-owners for providing the taxable service to the tenants. It is his contention that therefore, merely because the definition of "person" under the General Clauses Act includes that of association of persons or body of individuals whether incorporated or not, would not ipso facto be applicable to the co-owners who receive the rent separately and assessed to Income Tax separately having different PAN numbers. It is his contention that the meaning of "association of persons" has been considered by Hon'ble Supreme Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t receive the lease rent separately in proportion to the share in the property, is eligible to the benefit of threshold exemption limit as prescribed under Notification No.6/2005-ST, dt.1.3.2005, as amended, separately. The relevant notification reads as follows:- "Service Tax exemption when value of taxable service provided not exceeds Rs. 4 lakhs in a financial year In exercise of the powers conferred by sub-section (1) of section 93 of the Finance Act, 1994 (32 of 1994) (hereinafter referred to as the said Finance Act), the Central Government, on being satisfied that it is necessary in the public interest so to do, hereby exempts taxable services of aggregate value not exceeding four lakh rupees in any financial year from the whole of the service tax leviable thereon under section 66 of the said Finance Act: Provided that nothing contained in this notification shall apply to, - i) taxable services provided by a person under a brand name or trade name, whether registered or not, of another person; or (ii) such value of taxable services in respect of which service tax shall be paid by such person and in such manner as specified under sub-section (2) of section 68 of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lue of taxable services rendered by a provider of taxable service from one or more premises, does not exceed rupees four lakhs in the preceding financial year. 3. For the purposes of determining aggregate value not exceeding four lakh rupees, to avail exemption under this notification, in relation to taxable service provided by a goods transport agency, the payment received towards the gross amount charged by such goods transport agency under section 67 for which the person liable for paying service tax is as specified under sub-section (2) of section 68 of the said Finance Act read with Service Tax Rules, 1994, shall not be taken into account. Explanation. - For the purposes of this notification, - (A) "brand name" or "trade name" means a brand name or a trade name, whether registered or not, that is to say, a name or a mark, such as symbol, monogram, logo, label, signature, or invented word or writing which is used in relation to such specified services for the purpose of indicating, or so as to indicate a connection in the course of trade between such specified services and some person using such name or mark with or without any indication of the identity of that person; ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the scope and meaning of association of persons they have referred to the judgment of Hon'ble Supreme Court in the case of CIT Vs Indira Balkrishna (supra) followed in Deghamwala Estates (supra) case where under similar circumstances, the co-owners who received the rent income proportionate to their share had been assessed to income tax separately, but not as an association of persons. 8. Hon'ble Supreme Court, while discussing the meaning of association of persons in their judgment in the case of Commissioner of Income Tax Vs Indira Balkrishna - 1960 (4) TMI 7 - Supreme Court, observed as follows:- "We now come to the main question in this appeal. What constitutes an "association of persons" within the meaning of the Income Tax Act? It has been repeatedly pointed out that the Act does not define what constitutes an association of persons, which under Section 3 of the Act is an entity or unit of assessment. Previous to the year 1924, the words of Section 3 were "individual, company, firm and Hindu undivided family". By the Indian Income-tax (Amendment) Act of 1924 (XI of 1924) the words individual, Hindu undivided family, company, firm and other association of individu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the word "associate" means, according to the Oxford Dictionary, to join common purpose, or "to join in action". Therefore, an association of persons must be one in which two or more persons join a common purpose or common action, and as the words occur in a section which imposes a tax on income, the association must be one the object of which is to produce income, profits or gains. This was the view expressed by Beaumont, C.J., in Commissioner of Income-tax, v. Lakshmidas Devidas at page 589 and also in In re Dwarkanath Hirischandra Pitale, In re B.N. Elias, Costello, J., put the test in more forceful language. He said: it may well be that the intention of the Legislature was to hit combinations or individuals who were engaged together in some joint enterprise but did not in law constitute partnerships When we find,. that there is a combination of persons formed for the promotion of a joint enterprise then I think no difficulty arises whatever in the way of saying that these persons did constitute an association We think that the aforesaid decisions correctly lay down the crucial test for determining what is an association of persons within the meaning of Section 3 of the Incom ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... position advanced by the Revenue that all the co-owners providing the service of renting of immovable property be considered as an association of persons and the service tax on the total rent be collected from one of the co-owners. Another argument of the Revenue is that since the property is indivisible and not earmarked against each of the co-owners, hence the service tax is leviable on the total rent received against the said property without apportioning against each of the co-owners in proportion to their share. We find fallacy in the said argument of the Revenue. Conceptually service tax is levied on the service provided, which is an intangible thing and hence it is not necessary to be identified with physical demarcation of the immovable property given on rent against individual co-owners. Once the value of service provided by a service provider is ascertainable service tax is accordingly charged. This Tribunal in similar facts and circumstances in the cases of Deoram Vishrambhai Patel, Anil Saini & Others and Luxmi Chaurasia(supra) after considering the issues raised, rejected the contention of the Revenue and allowed the benefit of exemption Notification No.6/2005-ST, dt.1 ..... 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