Please Help: Service tax on rent
Posted Date : 13-Sep-2011 , 04:13:31 pm | Posted By Rajiv Mittal
Is service Tax applicable on rent from immovable property?
Category : Service Tax | Answers : 1 | Comments : 2 | Hits : 458
Answers
Answer By: Ashish Karundia
Dear Rajiv,
Service Tax is applicable on renting of immovable property as the constitutional validity of the same is upheld by P& H HC, Gujarat HC and Bombay HC. However, the constitutional validity of the same was held to be ultra vires in the case of Home Retails solutions by Delhi HC.
As the constitutional validity of the same is upheld by three HC, it is advisable to pay service tax on the same as the delay in depositing ST may attract interest and other penal consequences.
Service Tax is applicable on renting of immovable property as the constitutional validity of the same is upheld by P& H HC, Gujarat HC and Bombay HC. However, the constitutional validity of the same was held to be ultra vires in the case of Home Retails solutions by Delhi HC.
As the constitutional validity of the same is upheld by three HC, it is advisable to pay service tax on the same as the delay in depositing ST may attract interest and other penal consequences.
Comments
Chetan Agrawal
14-Sep-2011 , 01:45:29 pmChetan Agrawal
14-Sep-2011 , 02:00:21 pmDear Rajiv, i to agree with with Ashish Karundia & Co. However, i want to make one more addition in the clarrification made above which to my mind is necessary to keep into consideartion is that Service tax will be levied only on renting of commercial immovable property and if the is rented and used for resdential purpose then the same will not be chargeble to Service tax. Further there are certain other exclusions and inclusions which are provided in the Act. I suggest u to please refer Section 65(105)(zzzz) and Section 65(90a) of the Service tax Act for better understanding of the same.