Page 32 - GSTL_20th August 2020_Vol 39_Part 3

Renting of Immovable Property service — One time
premium amount received for granting theatre
premises on lease for 999 years whether leviable to
Service Tax?
The Supreme Court Bench comprising Hon’ble Mr. Chief Justice of India
Sharad Arvind Bobde, Hon’ble Mr. Justice A.S. Bopanna and Hon’ble Mr. Justice
Hrishikesh Roy on 12-6-2020 admitted the Civil Appeal No. 2090 of 2020 filed by
Starcity Entertainment Private Limited against the CESTAT Final Order No.
A/87207/2019-WZB, dated 11-11-2019 as reported in 2020 (39) G.S.T.L. 266 (Tri -
Mumbai) (Starcity Entertainment Private Limited v. Commissioner).
The Appellate Tribunal in its impugned order had held that arrangement
of aliening building on payment of regular rent coupled with one time premium,
even for long term lease, has been held in catena of decisions to be falling under
scope of Renting. Further, in this case entire property and its benefits had not
been alienated inasmuch as right to built-up space above and around contracted
property had been retained. Thus, by no means it is a sale agreement as content-
ed by appellant. Tribunal held that activity of limited use of property for consid-
eration is clearly taxable under Renting of Immovable Property services. Further,
such taxability is for entire premium amount because premium is nothing but
rent received in advance.
REPRESENTED BY : Mr. Aneesh Mittal, AOR, Mr. Bharat Rai
Chandaran and Ms. Shreya Sharma, Advocates, for
the Appellant.

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GST LAW TIMES  20th August 2020  32