Government Entities Selling Plots at Commercial Rates Cannot Claim Service Tax Exemption Under Notification 25/2012-ST

CESTAT ruled against exemption under S.No. 12(a) of Notification No. 25/2012-ST for services provided to RDA and NRDA, finding both authorities were engaged in commercial activities with plots and townships sold at commercial rates. However, the Tribunal remanded the matter regarding S.No. 12(e) exemption for reservoirs, sumps, and pumping stations, clarifying that "plant" would include pumping stations and interconnected reservoirs/sumps. CESTAT also directed reexamination of NRDA services eligibility under S.No. 12(e). The Tribunal set aside the extended period of limitation and associated penalties, finding no deliberate misstatement or suppression. Appeals allowed by way of remand to the Original Sanctioning Authority. .....

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