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TMI Blog2023 (2) TMI 833X X X X Extracts X X X X X X X X Extracts X X X X ..... vying, demanding or collecting service tax from the petitioner towards the rent/license fee paid by the petitioner to the fifth respondent other than by authority of law. The specific case of the petitioner is that the fifth respondent has not provided any taxable service to the petitioner during the period between 10.09.2004 and 01.06.2007 and therefore, the attempt of the fourth, fifth and sixth respondents to fasten the service tax liability on the petitioner by passing on the incidence of tax on the petitioner under Section 65(105)(zzm) of the Finance Act, 1994 (Chapter V - Service Tax) was unsustainable and contrary to law. HELD THAT:- Service of renting of immovable property is a separate specie of service. It was brought within the purview of service tax separately vide Section 65(105)(zzzz) with effect from 01.06.2007. Ipso facto, it would not mean that any service tax which was payable by the fourth respondent for the service provided by it in any Airport or a Civil Enclave to any person between 10.09.2004 and 31.06.2007 was not taxable - Merely because the service of renting of immovable property was introduced as a separate levy with effect from 01.07.2007 ip ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... S.Vaidyanathan And The Hon'ble Mr.Justice C.Saravanan For the Petitioner : Mr.Krishna Srinivas for M/s.Ramasubramaniam Associates For the R1 to R3 : Mr.A.P.Srinivas Senior Standing Counsel For the R4 to R6 : Mr.R.Parthiban ORDER S.VAIDYANATHAN, J. AND C.SARAVANAN, J. The petitioner has filed this Writ Petition for issuance of:- i. Writ of Declaration to declare that the levy, imposition, demand or collection of service tax from the petitioner by the respondents herein for the payment of license/rental fee paid by the petitioner to the fifth respondent herein as unconstitutional, and ii. Writ of Mandamus to forbear the respondents, their men, agents, sub-ordinates or anyone claiming under them from in any manner imposing, levying, demanding or collecting service tax from the petitioner towards the rent/license fee paid by the petitioner to the fifth respondent other than by authority of law. 2. When this case was taken up for hearing, it was informed that the Registry vide its Roc.No.104/2011 (Writs), dated 14.07.2011 has transferred the original records in respect of W.P.Nos.23431, 41293, 47104 to 47106 39719 of 2006 and 1479 of 2007 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ports Authority of India or persons authorized by it would be liable to service tax and that service tax would not be attracted on rental/lease charges within Airport/Civil Enclave premises. Based on this circular, no service tax was payable for letting out space in Airport/Civil Enclave premises to the petitioner. A reference was made to the following decisions:- i. Flemingo Duty Shops Private Limited . Vs. Union of India and Ors. , 2012 (28) STR 449 (Del); ii. Sahara Airlines Limited. Vs. Union of India , in W.P.(C) No.7145 of 2011 passed by the Bombay High Court. iii. CCE. Vs. Cochin International Airport , 2011 (24) STR 20 (Ker). 9. It is further submitted that from 01.06.2007 to 01.07.2010, Section 65(105)(zzzz) and Section 65(90a) of the Finance Act, 1994 (Chapter V - Service Tax) were in force, whereby, the letting out of property became exigible to service tax. Also, during this period, the proviso to Section 65(105)(zzm) of the Finance Act, 1994 (Chapter V - Service Tax) had not been introduced. Further, it is submitted that Section 65A would be only applicable for services rendered within Airport/Civil Enclave. 10. It is submitted that Section 65(10 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Hon ble Supreme Court after referring to the definition of taxable service in Section 65(105)(zzm) of the Finance Act, 1994 (Chapter V - Service Tax) has observed as under:- 15. Albeit, it is true that the appellant deposits a licence fees of Rs.2,66,797 per month to AAI but it collects the required fees from the users of the facility and provides all facilities to such customers. Section 65 Clause (105) (zzm) of the Finance Act, 1994 defines taxable service to mean any person, by Airports Authority or any person authorized by it, in an airport or a civil enclave. It is thus crystal clear that the appellant being a person authorized by AAI to provide service in express terms and conditions, it becomes liable to pay such tax as it was an authorized person to provide taxable service and collect the admission ticket charges on a contract basis. 17. By way of rejoinder, the learned counsel for the petitioner would submit that the decision of the Hon ble Supreme Court in the above case cannot be applied to the facts of the case. It is submitted that a dispute in the said case was confined to an agreement entered into between Airport Authority of India and the appella ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... binding on the Court as held by the Hon ble Supreme Court in the case of Commissioner of Central Excise, Bolpur Vs. M/s Ratan Melting Wire Industries , (2004 (6) SCC 722. We therefore refrain from giving a seal of approval of this Court to the above Circular. 23. Section 65(105)(zzm) of the Finance Act, 1994 (Chapter V Service Tax) was subsequently amended by Finance Act, 2010. It was notified vide Notification No.24/2010-ST, dated 22.06.2010 with effect from 01.07.2010. Thus, provision as in force from 10.09.2004 to 30.06.2010 and from 01.07.2010 to 30.06.2012 read slightly different. 24. For a better understanding of the dispute in the present Writ Petition, both the definitions as it stood introduced with effect from 10.09.2004 and as it stood substituted with effect from 01.07.2010 are reproduced below in a Table:- As introduced by Finance (No.2) Act, 2004, with effect from 10.09.2004 As substituted by Finance Act, 2010 with effect from 01.07.2010 vide Notification No.24/2010-ST, dated 22.06.2010. Section 65 Definitions:- (1) .. (105) (105) taxable service means any servi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ervice when the same is rendered wholly or within the Airport or Civil Enclave is not relevant for enquiry in this Writ Petition as in this Writ Petition, we are concerned with definition as it stood during the period between 10.09.2004 and 01.07.2007 prior to introduction of service tax on Renting of Immovable Property vide Section 65(105)(zzzz) of the Finance Act, 1994 (Chapter V Service Tax) with effect from 01.07.2007. 27. In this Writ Petition, we are also not concerned with the amendments brought to the provision of taxable services in Section 65(105)(zzm) of the Finance Act, 1994 (Chapter V Service Tax) with effect from 01.07.2010. 28. The renting of immovable property which was brought within the purview of service tax net vide Finance Act, 2007, with effect from 01.06.2007 introduced the definition of renting of immovable property in Section 65(90a) of the Finance Act, 1994 (Chapter V Service Tax) to read as under:- 65. Definitions:- (1) . .. (90a) renting of immovable property includes renting, letting, leasing, licensing or other similar arrangements of immovable property for use in the course or furtherance of business or commerce ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enant thereto; (ii)land incidental to the use of such building or part of a building; (iii)the common or shared areas and facilities relating thereto; and (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, 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. (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; * 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 partl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... between 10.09.2004 and 31.06.2007 was not taxable. 35. Merely because the service of renting of immovable property was introduced as a separate levy with effect from 01.07.2007 ipso facto would not mean that service provided by the Airport Authority of India was not liable to tax w.e.f. 10.09.2004. 36. By this Writ Petition, the petitioner has attempted to pre-empt the fourth, fifth and sixth respondents from passing on the incidence of service tax which was either borne by them or was proposed to be borne by them towards renting of space to them within the Airport or a Civil Enclave. Whether the fourth respondent is/was liable to tax or not is to be determined by the Authorities enforcing the provisions of the Finance Act, 1994. 37. If any proceeding(s) was/were initiated by the statutory Authority, it is open for the fourth respondent to rely upon the above Circular No.80/10/2004-ST, dated 17.09.2004 issued by the Central Board of Excise and Customs before the said Authority as such Circulars are only binding on the Authorities [ see Collector of Central Excise, Vadodra Vs. Dhiren Chemical Industries , (2002) 2 SCC 127 : 2001 SCC OnLine SC 1447] though not binding ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (zzm) and would be taxable. 41. Presently, issue is also covered against the Airport Authority of India in terms of the decision of Delhi Tribunal in Airport Authority of India Vs. Commissioner of Service Tax, Delhi, 2015 (39) STR 35 (Tri. - Del)) and a S.L.P. has filed against the above Judgment and is said to be pending before the Hon ble Supreme Court. 42. We are of the prima facie view that the above view of the Tribunal in Airport Authority of India Vs. Commissioner of Service Tax, Delhi , 2015 (39) S.T.R. 35 (Tri. Del.) is correct view. Against the above order of the Tribunal, Special Leave Petition has been filed before the Hon ble Supreme Court and same is said to be pending in Airports Authority of India Vs. Commissioner , as reported in 2018 (11) G.S.T.L. J138 (S.C.). 43. Therefore, we do not wish to make further observations on merits though we are of the prima facie view that the Airport Authority of India was liable to service tax and was entitled to pass on the incidence of the tax on the petitioner. 44. Considering the fact that the issue is pending before the Hon ble Supreme in S.L.P. filed against the above decision of Delhi Tribunal in ..... 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