Case Law Details
CESTAT, MUMBAI BENCH
Econ Hinjewadi Infrastructure (P.) Ltd.
Versus
Commissioner of Central Excise, Pune-III
ORDER NO. S/1210/2012/CSTB/C-I
APPLICATION NO. ST/Stay/1521 of 2012
APPEAL NO. ST/469 of 2012
SEPTEMBER 25, 2012
ORDER
Ashok Jindal, Judicial Member
The applicant are seeking waiver of pre-deposit of service tax of Rs. 2,85,85,512/- along with interest on ‘Renting of Immovable Property Service’ and equal amount of penalty under section 78 of the Finance Act, 1994.
2. The brief facts of the case are that the applicant are owner of premises which have several units and were given on rent to various persons. The applicant is paying service tax on the rent received from their tenants. The applicant are also involved in the activity of maintaining and repairing of the building and the applicant are paying service tax on this activity also. These payments of service tax is not in dispute. Apart from these, the applicant is under an obligation to supply electricity to their tenants and (for that) a common electricity connection has been taken by the applicant from MSEB and separate meters has been installed in each premises and on the basis of reading in the meter the applicant is charging electricity charges from the tenants. When electricity is not being supplied by MSEB, the same is supplied through DG set to the tenants and on that also they are charging electricity charges from the tenants. The Revenue is of the view that electricity charges recovered from their tenants is to be part of the service of ‘Renting of Immovable Property Service’ and, therefore, a notice was issued and demand for service tax was confirmed against the applicant along with interest, apart from penalty of equivalent amount under section 78 of the Finance Act, 1994.
3. The contention of the learned counsel is that in similar set of facts, in the case of Panchsheel Tech Park Pvt. Ltd., vide order no. 22-23-24/P-III/ST/COMMR/2011-12, dated 28.11.2012 the proceedings has been dropped against the assessee and that order has been accepted by the Committee of Chief Commissioners vide order dated 14.06.2012. In the impugned order, the applicant has contended before the adjudicating authority that supply of electricity is supply of ‘goods’ and the same is exempted as per Notification no. 12/2003-ST wherein it has been clarified that supply of goods shall not form part of taxable service. On this contention, the adjudicating authority has not given any finding in the impugned order and, therefore, he prays that stay be granted.
4. Heard the learned AR and perused the adjudication order passed in the case of Panchsheel Tech Park (P.) Ltd. (supra). The contention of the applicant that electricity is ‘goods’ and the same shall not form part of taxable service is clarified by the Notification no. 12/2003. Therefore, we find that the applicant has made out a prima facie case for 100% waiver of the service tax confirmed and penalty imposed. Accordingly, we waive the requirement of pre-deposit of the service tax, interest and penalty and stay recovery thereof during the pendency of the appeal.
