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TMI Blog2023 (4) TMI 262X X X X Extracts X X X X X X X X Extracts X X X X ..... The rent is also paid by the service recipient to each individual. In such case, every individual become a separate service provider hence, if at all service tax arises, it needs to be assessed in respect of every individual. Further, the rent received by the individual is well within the threshold limit provided for exemption under Notification No. 6/2005-ST dated 01.05.2005. Therefore, there is no service tax liability on any of the appellant. Identical issue has been considered by this Tribunal in the case of M/S NEENABEN R DOSHI, MANJU MUKESH GARG GUNJAN PARVESH GARG, RITABEN PIYUSHKUMAR DOSHI, KISHORBHAI PRANJIVANDAS MANDALIA, VIPULKUMAR ZAVERILAL MANDALIA, PRANJIVANDAS MANDALIA, CHANDRESHBHAI ZAVERILAL MANDALIA, BHANUBEN PRANJIVANDAS MANDALIA, PRAFULLABEN ZAVERILAL MANDALIA, FENNY CHANDRESH MANDALIA, SMT. ARUNA KISHOR MANDALIA, SHRI SHEKHAR KANAIYALAL SHAH, BHANUBEN PRANJIVANDAS MANDALIA, DAKSHA BHARATKUMAR MANDALIA, MRUDULA KANAIYALAL SHAH, SUJATA SHEKHAR SHAH, HEMALI VIPUL MANDALIA, ZAVERILAL VIRJIBHAI MANDALIA VERSUS C.S.T. S.T. - AHMEDABAD [ 2019 (5) TMI 1485 - CESTAT AHMEDABAD] where it was held that receipt of rental income by every individual is only subject ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 10) TMI 476 CESTAT Chennai Shri SV Janardhanam vs. Commissioner GST CCE, Salem (g) 2018 (10) TMI 400 CESTAT Chennai Shri Syed Ahamed Ors vs. Commissioner GST CE, Trichy (h) 2017 (49) STR 541 (Tri. All.) CCEX ST, Allahabad vs. Luxmi Chaurasia 3. Shri Vijay G Iyengar, learned Assistant Commissioner (AR) appearing on behalf of the Revenue reiterates the findings of the impugned order. 4. We have carefully considered the submissions made by both sides and perused the record. We find that clubbing the property as co-owned by the persons, five appellants own equal share. All the appellants entered into lease agreement with Reliance Industries Limited and for this, each appellant became an independent service provider in respect of renting of immovable property. As per facts, there is no legal entity such as Association of Persons of Body Corporate, each person owns the property. As per lease agreement, every individual is independent owner of his share. The rent is also paid by the service recipient to each individual. In such case, every individual become a separate service provider hence, if at all service tax arises, it needs to be assessed in respect of ev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hus, it is difficult to accept the proposition 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 ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -2012 and all the four co-owners individually paid their Service tax liability along with interest on 14-2-2012. Thus, the ownership of the Property and providing of taxable renting of immovable Property by the four appellants in this case is in their individual capacity and, therefore, their tax liability should have been determined by considering their individual rental receipts and not collective one. From the various lease agreements made with above mentioned Commercial firms, it cannot be disputed that monthly rent was paid by the above named concerns to each appellant after deducting tax at their end. 6.3 From the show cause notice dated 19-10-2012, it is evident that the appellants had received rent as detailed below:- Sr. No. Period Amount 1 2007-08 (1-6- 2007 to 31-3- 2008) Rs. 29,21,048/- 2 2008-09 Rs. 36,27,024/- 3 2009-10 Rs. 46,72,744/- 4 2010-11 Rs. 52,63,304/- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... service tax along with interest on their own. Thus, the claim of the appellant that they had paid service tax for the years 2009-10 and 2010-11 on their own initiative and there was no suppression of facts etc. on their part with any intention to evade service tax cannot be denied. Considering all these facts, I agree with the appellant‟s contention that this case was squarely covered under sub-section (3) of Section 73 which provided not to issue any notice under sub-section (1) of Section 73 if the service tax not levied or paid was paid along with interest by the person concerned before service of notice on him and informed the Central Excise Officer of such payment in writing. Further in Explanation 2 of the said sub section it is also clearly provided that no penalty under any of the provisions of the Act or the Rules made thereunder shall be imposed in respect of payment of service tax under this sub-section and interest thereon. Hence, in fact no SCN was required to be issued in this case for recovery of service tax and imposition of penalty and even when it has been issued, no penalty under Section 76 or 78 is imposable in this case for the period 2009-10 and 2010-11. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thout telling any legal basis for doing so. The appellants have contested the Order in Original mainly on the grounds that rented property belongs to four separate persons (all brothers) but the service tax has been demanded wrongly by the department from the appellants by clubbing the rent received by all the coowners and, therefore, the demand of tax is not maintainable on this ground alone. In support they have produced a City survey Extract as evidence regarding ownership of the rented property which shows that the said property was purchased in 2003 and is owned jointly by all the four co-owners. Further, the lease agreements with M/s. Max New York Life Insurance Co. Ltd., Oriental bank of Commerce, Axis Bank, Kotak Mahindra Bank and HDFC Standard Life Insurance Ltd. are also entered into by the appellants in their individual capacity, as per SCN also, all four co-owners have obtained separate Registration Certificate on 10-4-2012 and all the four co-owners individually paid their service tax liability along with interest on 14-2-2012. Thus, the ownership of the Property and providing of taxable renting of immovable Property by the four appellants in this case is in their indi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot arise. For the subsequent period i.e. 2009-10 6.4 2010-11, the appellants have already accepted their tax liability and paid Service tax along with interest on 14-2-2012. The said payment of service tax is certainly a delayed payment, but was made by the appellants on their own when they realized that their taxable value for renting of property had exceeded the exemption limit of Rs. 10 lakhs. The adjudicating authority has claimed in his order that the appellants paid service tax only after Department started investigation, but is not supported by any evidence or the facts on record. The SCN or the OIO do not talk of any audit objection or Preventive action or any inspection etc. on the basis of which not payment of service tax by the appellants was pointed out. Instead in the SCN, one statement of Shri Chandulal Vishrambhai Patel is only referred to which was recorded on 22-2-2012 which is 8 days after the appellants had paid service tax along with interest on their own. Thus, the claim of the appellant that they had paid service tax for the years 2009-10 and 2010-11 on their own initiative and there was no suppression of facts etc. on their part with any intention of evade ..... X X X X Extracts X X X X X X X X Extracts X X X X
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