Service Tax on renting of immovable property – ASG's Advice to the FM
THE Supreme Court has passed an order to the effect that the High Court of Delhi will hear and dispose of all the writ petitions as expeditiously as possible. Further, the Supreme Court has ordered that the interim order which was passed by the Supreme Court on 10.1.2011 would continue to operate till the disposal of the writ petitions in the High Court. In effect, the interim order, dated 18.5.2010, passed by the Delhi High Court (post amendments), staying the levy of service tax on renting of immovable property has been nullified. Subsequent to the interim order of Delhi High Court, dated 18.5.2010, a large number of orders were passed by various High Courts, staying the levy of service tax on renting of immovable property till final disposal of WPs.
The Additional Solicitor General of India has opined that the Union of India is now legally empowered, in view of the Supreme Court order, as mentioned above, to collect service tax on commercial properties until the final judgement of the High Court of Delhi in the post amendments scenario. He has advised the FM that applications may be moved before all the High Courts in India for vacation of interim direction issued in favour of petitioners.
So the CBEC directs the field to collect service tax on commercial properties until the final judgement of the High Court of Delhi in the post amendments scenario.
Board directs that:-
1. Necessary action for filing of application for vacation of interim directions issued in favour of petitioners by various High Courts may please be taken expeditiously.
2. Necessary steps for collection of pending service tax may also be taken.
CBEC Letter F. No. 276/282,2010- CX.8A; Dated: February 24, 2011