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TMI Blog2023 (11) TMI 308X X X X Extracts X X X X X X X X Extracts X X X X ..... e same as per the guidelines of the Act to the various Industrial Units on lease basis and charged certain amounts in lieu of this. Administrative Charges Realized - HELD THAT:- The said charges have been collected by the appellants with reference to the acquisition of land as prescribed under IDCO Act, 1980. Therefore, the said Administrative Charges Realized by the appellants are statutory charges for allotment of plot, which does not cover under Real Estate Agency s Service . Accordingly, no service tax is payable on the said amount. Processing Fees - HELD THAT:- The processing fee is collected from the land allotees for post-acquisition Allotment and consequential Transfer of property in their favour in Industrial Estate and Industrial area as per IDCO Act, 1980. Therefore, no service tax is payable one the said amount. Transfer Fees - HELD THAT:- The said charges have collected in terms of Circular issued by IDCO on mutual transfer of lease hold interest in IDCO allotted properties in Industrial Estate and Industrial Area on payment of processing fee and transfer fee and the same has been fixed by IDCO. The said services are in the statutory levy in nature, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nants - HELD THAT:- The appellant is collecting water charges in terms of Orissa Irrigation Act, 1959 and required for water supply to the Industrial Estate, Buildings and Tenants. These are the water charges. Therefore, it cannot be termed as Renting Immovable Property. Therefore, the said activity is not liable to service tax under Renting Immovable Property. Therefore, no service tax is payable on the appellant on the said services. Ground Rent Collection - Cess Collection - HELD THAT:- The said collections are statutory levy, which the appellants collected from the allottees and transferred the same to the concerned officers, Revenue Department, Government of Orissa. Therefore, the said service cannot be said as Renting of Immovable Property and accordingly, no service tax is payable by the appellant on the said activity. Maintenance Charges Realized - HELD THAT:- On payment by the appellant to the outsource agency and paid the service tax thereon, is also entitled for cenvat credit of service tax paid on hiring charges by the appellant. In that circumstances, the appellant is liable to pay service tax under the category of Maintenance and Repair Service on the maint ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t receipts under the category of Commercial and Industrial Construction Service . Penalties - HELD THAT:- No penalty is imposed on the appellants. Accordingly, the same is dropped. Appeal disposed off. - MR. ASHOK JINDAL, MEMBER (JUDICIAL) AND MR. K. ANPAZHAKAN, MEMBER (TECHNICAL) Shri B.S. Tripathy Mr. Amaresh Mishra, both Advocates for the Appellant Shri J. Chattopadhyay, Authorized Representative for the Respondent ORDER All the appeals are having a common issue, therefore, all are disposed off by a common order. 2. The facts of the case are that the appellant is a statutory Corporation established under IDCO Act, 1980 to carry out the Governmental functions for development of industrial infrastructures in the State of Orissa. In consequence of the IDCO Act, 1980, all these Income Heads of the appellant are related to land acquisition by IDCO of private lands under Land Acquisition Act, 1894 and Government Land settled with IDCO under Orissa Government Land Settlement Act, 1962. After acquisition settlement, the land vested with IDCO under Section 31 (2) of IDCO Act, 1980 free from all encumbrances and thereafter, handed over to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the appellant from the allottee in addition to the land premium, the appellants are liable to pay service tax. 2.4 Therefore, various show-cause notices were issued to the appellants to demand service tax along with interest and to impose penalty on the appellants. 2.5 The show-cause notices were adjudicated and orders were passed demanding service tax along with interest and penalties were also imposed. 2.6 Against the said order, the appellants are before us. 3. The ld.Counsel for the appellants, submits that appellant being a statutory Corporation established under IDCO Act, 1980, is discharging statutory functions for acquisition of land and sovereign functions of the industries in terms of IDCO Act, 1980, which are related to various State Government s Order. Therefore, the appellants are not liable to pay service tax. 3.1 He further submits that for income from Ekamra Hat, the demand is sought under Renting of Immovable Property Service. The appellant is paying service tax under Mandap Keeper Service. The rent is collected as per the rate prescribed by the Central Government as well as State Government through Scheme for Development of Commercial Handi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orized construction and use of land contrary to the terms of holding held in terms of Section 38 of the IDCO Act. according to which any person awarded is in existence or apart any other person, undertakes or carries out construction or alternates any building in Industrial Estate or Industrial area contrary to the terms held under this Act, shall be of application to the extent of Rs.10,000/- in case of continuation of contravention further fine of Rs.200/- for over during his such first commission of offence. Water Charges realized from Industrial Estates, Buildings and Tenants: As per Orissa Irrigation Act, 1959 and Rules framed thereunder Govt. prescribed Water Rate @ Rs.250/- from 18 July 1998 per lakh gallon of water for Industrial/Commercial consumption. Copy of Revenue Department Gazette Notification dt.18.07.1998 is filed herewith. Water charges are collected by IDCO from Entrepreneurs, Tenants from Industrial Estates and Industrial Areas have been deposited by IDCO in Govt Treasury. IDCO has been paying huge amount for deployment of employee to manage of Water Supply system. Ground Rent (xiii) Cess Collection As per IPR, the ground rent wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xpenditure with additional incentive of 2% for timely compliance of the awarded work. Execution of work would be strictly in accordance with the plan, design prepared by IDCO and accepted by Govt. Building including Govt. College Buildings as per Work procedure issued by Govt. of Odisha in OPWD Code of Works Dept. In this context sample copy of Agreement for construction of the Odisha State Beverages Corporation Ancillary Building for storage of Alcoholic Beverages, Chhatarpur and MoU for construction of new Class Room of Kunja Bihari College, Bhubaneswar, are filed. 3.3 It is his submission that the appellant is paying service tax under Mandap Keeper Service and Rent Receipt Service. 3.4 He also relied on the Notification No.41/2016-Service Tax dt.22.09.2016 to show that Central Government is exempted taxable service on State Government Industrial Development Corporation/ Undertakings to Industrial Units by way of long term 30 years or more lease of industrial plots from service leviable U/s.66(b) of the Act as is leviable onetime premium summary price cost by any other names payable for such lease. 3.5 He, therefore, prayed that the proceedings against the appellant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cost in floating Tender Call Notice, Engineering Operation, Design Cost, Manpower Cost employed for Estate Soil Testing supervision cost and fixed expenditure on Ministerial staff. The said Supervision Charges are required for Development of the Industrial Estate, which is statutory functions, which is to be discharged by the appellant. Accordingly, the same cannot be termed as Consulting Engineering Service , therefore, no service tax is payable by the appellants on the said Supervision Charges. (5) Works Income : Under this Head IDCO, the appellants collected (i) Soil Testing Charges for Laboratory Expenses with reimbursement cost of Jr. Scientist of State Soil Testing Laboratory, Bhubaneswar and (ii) Equipment Hire Charges including cost of Operator, repair and maintenance of equipment. Up to 2007-2008, there was Technical Testing conducted by IDCO through its own Mechanical Maintenance Division, which activity was closed since 2008 and has been undertaken through other Agencies on payment of cost. We find that the said activity has been hired by the appellants for testing of the soil of the industrial area, which were beneficiaries to the land allottees, whi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... upation Charges and also for unauthorized construction and use of land contrary to the terms of holding held in terms of Section 38 of the IDCO Act, accordingly to which any person awarded is in existence or apart any other person, undertakes or carries out construction or alternates any building in Industrial Estate or Industrial area contrary to the terms held under the Head has to pay the said amount for commission of the said offence. We find that these charges are the levy as occupied the land unauthorizedly, which cannot be terms as Renting Immovable Property, therefore, no service tax is payable by the appellant from the said services. (11) Water Charges realized from Industrial Estate, Buildings and Tenants : The appellant is collecting water charges in terms of Orissa Irrigation Act, 1959 and required for water supply to the Industrial Estate, Buildings and Tenants. These are the water charges. Therefore, it cannot be termed as Renting Immovable Property. Therefore, the said activity is not liable to service tax under Renting Immovable Property. Therefore, no service tax is payable on the appellant on the said services . (12) Ground Rent Collection ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e assurances and also suffer from huge loss on the said account due to non-recovery of IMD from sick units and the said charges have been recovered by the appellant in terms of Section 17 of IDCO Act, 1980 as these are the statutory levy and the maintenance and repair etc. are not chargeable to service tax, which are the statutory functions provided by the appellant. Therefore, the said services do not qualify as maintenance and repair service. Accordingly, no service tax is payable by the appellant on the said charges. (16) Interest receipts on Land (Duburi Steel Complex) The appellant has invested huge amount on purchase of land at Duburi area and spent a lot in rehabilitation and infrastructure development in that area. The appellant allotted lands to Industries on payment land cost to be paid on instalments and in case default in payment of installments, interest is collected by the appellant from Duburi Steel Complex. The said interest collected for lease of land to the industries is not chargable to service tax under the category of Renting and Immovable Property and the same cannot be terms as Renting and Immovable Property. In that circumstances, no service ..... X X X X Extracts X X X X X X X X Extracts X X X X
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