Service Tax

BIBEKANANDA MOHANTI (Querist) 04 February 2011 This query is : Resolved
Is service tax leviable on rental service,ie:for giving premises on rent for commercial purposes.Are there any decisions on this matter by Tribunals/Courts etc.Is any matter on this issue pending before the Supreme Court.

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R.Ramachandran (Expert) 04 February 2011
The matter is still pending.
In Home Solutions matter the Delhi High Court took the view that while renting per se will not be liable0 for service tax, any service done "in relation to" renting of immovable property only will be liable for service tax.
However, Punjab & Haryana High Court has taken the view that after the retrospective amendment of the provision where the words "in relation to" has been deleted and "renting of immovable property" itself has been made a taxable service, service tax liability would arise on renting of immovable property. The CBEC Board has recently instructed its Officers to go by P&H High Court decision.
The matter is also subjudice before Supreme Court.

Basavaraj (Expert) 04 February 2011
right answer by Ramachandran

Rajesh Thakker (Expert) 05 February 2011
Mr. Ramchandran is correct. However, again litigation is started in various High Court and all Court had given a stay against the application of amended law.
Therefore, matter is still open and no final view can express on the point at present.

Sumit Batra (Expert) 14 February 2011
Dear All,

The Hon'ble Supreme Court has stayed the order of the Hon'ble Delhi High Court wherein stay was granted to the landlords/tenants from payment of service tax. However, the matter is listed for hearing tomorrow i.e. 15.02.2011 before the Delhi High Court and it is hoped that Delhi High Court will give some decision tomorrow.