Page 75 - GSTL_30th April 2020_Vol 35_Part 5

2020 ] RAJASTHAN STATE MINES & MINERALS LTD. v. COMMR. OF C. EX. & S.T., JAIPUR 561

2020 (35) G.S.T.L. 561 (Tri. - Del.)
IN THE CESTAT, PRINCIPAL BENCH, NEW DELHI
[COURT NO. II]
S/Shri Anil Choudhary, Member (J) and Bijay Kumar, Member (T)
RAJASTHAN STATE MINES & MINERALS LTD.
Versus
COMMR. OF C. EX. & S.T., JAIPUR

Final Order No. ST/A/51098/2019-CU(DB), dated 21-8-2019 in Appeal
No. ST/52845/2015-DB
Renting of Immovable Property service - Acquisition of land by Gov-
ernment of Rajasthan (GoR) undertaking for setting up of thermal power plant
as per agreement entered into with M/s. Raj West Power Limited (RWPL) -
Separate Implementation Agreement signed between GoR and RWPL for im-
plementation, operation and maintenance of lignite based thermal power plant
and Joint Venture unit (JV) by name of Barmer Lignite Mining Co. Limited
(BLMCL) formed for carrying out lignite mining - JV company not given title
of land and request for transfer of land, rejected - Demand raised on payment
made towards acquisition of land treating same to be made for transfer of sur-
face right in favour of JV - HELD : Land procured by GoR and assigned to as-
sessee - Surface right, contemplated by Revenue as service, emerges out from
activity of mining operation, as incidental activity - Land only acquired for
purpose of making it available to JV company, for setting up of power plant to
meet acute shortage thereof in remote area of State of Rajasthan - Entire
amount spent on acquisition of land deposited by M/s. RWPL, in escrow ac-
count with bank - If due to change of policy of Government of India and State
Government, transfer of land acquired was denied mutation to JV company,
same will not retrospectively convert sale into services of renting of immova-
ble property - Sale of land completed when Land Acquisition Officer (LAO)
made payment to cultivator - Activities undertaken by way of acquisition of
land from landholder, for project, not to be treated as service rendered respec-
tively, so as to charge Service Tax - Incidental activity cannot be treated as
main activity, which mining and benefit arising out of law, to be independent
service under category of renting of immovable property service - Also, even if
surface right presumed to be activity as renting of immovable property, entire
sale consideration could not be treated towards value of service provided -
Treatment of entire amount spent towards acquisition of land, by no stretch of
imagination, can be treated as value towards alleged service - No element of
service involved in transaction - Section 65(90a) of Finance Act, 1994. [paras 17,
18, 19, 20, 21]
Demand - Business Auxiliary Service - Whether 51% equity stake
granted to assessee by Implementation Agreement, in JV company, to be treat-
ed as “Business Auxiliary Service” - HELD : Category under which activity to
be treated as service, not given by Commissioner - Grant of 51% share in JV
not covered in any of sub-heading under “Business Auxiliary Service” as de-
fined in Section 65(19) of Finance Act, 1994 - Also, 51% of equity granted in
year, 2008-09, while notice issued beyond limit of five years - Therefore, show

GST LAW TIMES  30th April 2020  75