Case Law Details
TRENT Ltd and Future Value Retail Ltd have challenged before the AP High Court, the service tax with retrospective effect on renting of immovable property, brought in by the Finance Act, 2010.
The prayer in the Writ petition reads as,
To issue a Writ order or direction one more particularly in the nature of Writ of Mandamus
a) Declare the impugned provisions, viz. section 65( 90a ) read with Section 65(105 )(zzzz) of the Finance Act, 1994 as amended by the Finance Act, 2008 and Finance Act 2010 as null and void and ultra vires the Constitution of India and/ or section 66 of the Finance Act and /or be strike down the said provisions as illegal, arbitrary and violative of Articles 14, 246 and 265 of the constitution of India;
b) Issue a Writ order or direction in the nature of Certiorari or any other Writ, order or direction of like nature, setting aside Section 75(5 )(h) and Section 76 of the Finance Act 2010;
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Service tax on renting of Immovable property for furtherance of business is not Constitute Servce, and not liable to service tax. But Sub let is coming under the service tax even though it is part of furtherance business.
Very rightly said by Mr. Saggi the more and more Tax imposition will detre the growth of our economy these taxes will not be benefetial as it is the burden of the same will be borne by the end consumer so the socialistic idea behind the Tax will be defeated first up. Secondly the Tax imposed was itself contrary to the definition of Service as provided by the act and renting of a immovable premises is a tranfer of property they should have seen the definition of Lease provided in TOPA .
Service Tax on renting of immoveable property for retrospective period operation is clearly evident Ultra Vires and contrary to Articles of The Constitution of India . Ambit of service to consider by the Parliament thereafter is non application of mind by the Finance Minister to make arbitrary enactment and confuse Service tax.
Furtherance of business of commerce does not constitute service and if so then all businesses in India are liable to Service Tax and such taxation will block growth of all business in India.