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February 2012

(2011) 24 STR 705 (Tri.-Del.) Commissioner of Central Excise, Ludhiana v. Municipal Council.

By Puloma Dalal, Jayesh Gogri
Chartered Accountants
Reading Time 1 mins
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A show-cause notice for non-payment of service tax on renting of property and open ground; as Mandap Keeper services — Show-cause notice failed to divulge the nature of such receipts i.e., whether any official, social or business functions performed on the immovable property, so as to make the property mandap — Finding no substance in the show-cause notice — Stay application and appeal dismissed.

Facts:
The appellant received a sum of Rs.4,26,000 for letting out of land and open ground for the period 12-2-2003 to March, 2005 and receipt of Rs.6,000 each for the financial years 2005-06 and 2006-07 and Rs.93,000 for the financial year 2007-08 upon which no service tax was paid.

Held:
However, since the notice issued failed to bring out the nature of the receipt and the nature of functions performed over rented immovable property, the show-cause notice was rendered unjustified and hence, the stay application and the appeal were dismissed.

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