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TMI Blog2025 (4) TMI 1110X X X X Extracts X X X X X X X X Extracts X X X X ..... y the Commissioner The impugned order whereby he ordered recovery of service tax amounting to Rs. 81,33,828/- from the appellant under proviso to Section 73 (1) read with Section 68 of the Finance Act, 1994 The Finance Act and Rule 6 of the Service Tax Rules, 1994 The Rules. He also ordered recovery of interest under Section 75 of the Finance Act and imposed penalty of Rs. 81,33,828/- under Section 78 of the Finance Act. He also imposed a penalty of Rs. 10,000/- under Section 77 of the Finance Act and appropriated an amount of Rs. 30,045/- as interest. 2. The facts which led to the issue of the impugned order are that the appellant was a set up as a company on 21.09.1998 and it changed its name to the present "Prime Maxi Mall Management (P ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der the head "business auxiliary service" as defined in section 65 (19) and were taxable under section 65 (105) (zzb) as business auxiliary service. A show cause notice dated 20.10.2009 was issued to the appellant demanding service tax under the head of "business auxiliary service" as above. 5. It was stated in the show cause notice that the appellant was responsible for managing the complex, its upkeep in all respects, promoting the shoppers' traffic, assisting in augmenting the sales of the buyers and tenants of various spaces, act as a liaison agent between the developer and various users of the spaces in the complex, conceptualizing promotion programmes in a coordinated manner, help in increasing shopper's traffic resulting in increase ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ices and activity that amounts to manufacture with in the meaning of clause (f) of section 2 of Central Excise Act, 1994." 7. Since the appellant had not shown these incomes in it's service tax returns and they were discovered only on scrutiny of the appellant's income tax returns and balance sheets, the demand was raised invoking extended period of limitation along with interest and penalties were also proposed in the show cause notice. 8. The appellant resisted these proposals which were, however, confirmed in the impugned order. Submissions of the appellant. 9. Learned counsel for the appellant made the following submissions: (i) Although appellant had entered into an agreement for providing a variety of services, it had actually o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the developer. Therefore, the income received from the developer from this purpose was taxable under the head of business auxiliary service. (ii) The impugned order is correct and it calls for no interference. 11. We have considered the submissions advanced by both the sides and perused the records. 12. The show cause notice was issued demanding service tax on the income received by the appellant from mall management as per it's books of accounts. The question which arises is what were the amounts actually received for. The show cause notice relies on the agreement which the appellant had entered into with the developer to provide a variety of services and concludes that the amount was received for providing all these services which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e period after 01.05.2006 and the appellant paid service tax. The case of the department is that before 01.05.2006, the appellant was liable to pay service tax under the head "business auxiliary service" for promoting the business of the developer. Reliance is placed on the clauses in the agreement between the appellant and the developer. 15. The argument of the department cannot be accepted for two reasons. Firstly, if the services were rendered to the developer the consideration should have been received from the developer for rendering the service. In this case, the appellant had, instead of receiving any amount from the developers, paid the developer Rs. 1,00,000/- per annum and bought the space. Thereafter, it sold the space and earne ..... X X X X Extracts X X X X X X X X Extracts X X X X
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