Commissioner of Central Tax Vs Government Official Welfare Organisation (Delhi High Court)
Delhi High Court held that when the transaction is one of trading in land and no specific remuneration is fixed in the deal for acquisition of land, the same would not be liable to service tax. Accordingly, appeal of revenue dismissed.
Facts- The Respondent – M/s Government Official Welfare Organisation is an organization set up by serving and retired Central and State Government Officials. A development project was undertaken by the Respondent under a Memorandum of Understanding dated 30th July, 2009 with one M/s India Affordable Housing Solutions. The services that the IAHS provided was to identify certain reputed builders or developers so that bulk booking of residential flats could be done for the staff and their families.
In the course of this agreement, the Respondent had obtained applications from various staff members with a membership fee of Rs.50,000/- and some deposit for the application forms. The same were all retained in the account of the Respondent. The Builder-Buyer Agreements were thereafter executed through the Respondent.
Thereafter, allegations were raised by the Anti-Evasion Branch that the Respondent was working as a real estate agent and certain service tax demands were proposed to be raised by the Show Cause Notice dated 17th October, 2014. The SCN was adjudicated and in the Order-in-Original (hereinafter, ‘OIO’) dated 13thJuly, 2018, the SCN were dropped.
