is service applicable on rent on commercial property?

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VINOD KUMAR JHA

VINOD KUMAR JHA (Querist)
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13 May 2009 Dear All,

please resolve my query.

Madhukar N Hiregange

Madhukar N Hiregange (Expert)
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13 May 2009 Assuming that you are talking about renting of IP for commerce or industry and deifntion is met.
Delhi High Court decision:
Pure Rent- giving a building premises without any other additional servcies of security, receptionist, etc may notbe value added service ( since service itslef is not defined)
Further deifntion of service state in realtion to rent and not services of renting. Therefore the core renting is not liable.
This decision could be appealed to by the Revenue and cannot be blindly applied across India.
Addtional Arguments:
It is a state subject and therefore centre cannot tax.
Supreme Court has asked for all pending cases to be forwarded to ti so that it can decide the issue. Once that is decided matter may become more certain.

Though your question is simple thanks to the ever expanding entries in ST and lack of judicial clarity it couldbe said that the scale is not clearly tilted in favour of the landlord and they can choose not to pay if they are willing to take a little risk.
However if they wish to be safe the ST should be paid under protest which shouldbe communicated to the dept. and acknwoledgement obtained.