Page 88 - GSTL_3rd September 2020_Vol 40_Part 1

22 GST LAW TIMES [ Vol. 40
Sinha argues that even though Respondent No. 1 has discharged the liability to-
wards the rent amount, but the taxes levied on the invoices are outstanding.
7. Relying upon the provisions of the Finance Act and the judgment of
this Court in the case of Pearey Lal Bhawan Association v. Satya Developers Pvt. Ltd.,
173 (2010) DLT 685 = 2011 (23) S.T.R. 213 (Del.), it is contended that even though
the primary liability for payment of service tax/GST is on the owner of the prop-
erty, but the same is ultimately payable by the tenant. It is further argued that
both service tax as well as GST can be adjusted against the out-going taxes.
Therefore, whatever amount is paid by Respondent No. 1 towards the said taxes,
would eventually be entitled for adjustment. Keeping in view the scheme of taxa-
tion, Respondent No. 1 in all likelihood would have taken credit of the Service
Tax/GST deposited by the Petitioner with the tax department. However, despite
taking credit, Respondent No. 1 has not reimbursed the taxes and therefore the
availment is unauthorised. In order to verify this position, Petitioner issued legal
notice dated 25th May, 2020 to Respondent No. 1 and requested them to provide
Tax returns. Despite the service of the notice there has been complete silence
making it evident that credit of Service Tax/GST has been availed.
8. Mr. Sinha submits that since there is no other efficacious remedy un-
der law to seek the requisite information, he is making an innocuous prayer of
directing Respondent No. 2 to disclose and confirm as to whether Respondent
No. 1 has taken credit of Service Tax/GST amount charged by the Petitioner in
the monthly rent invoices. Petitioner is not seeking any reimbursement of the
taxes by way of the present petition. Mr. Sinha submits that the tax liability has
been discharged by payment to the tax department, but since the ultimate liabil-
ity of payment of service tax and GST is on the end user - tenant, Respondent No.
2 should be directed to provide the requisitioned information.
9. In our view, the present petition is misconceived. Apparently, Peti-
tioner has not received the entire amount against the monthly rent invoices for
the period commencing from November, 2012 to June, 2020. Petitioner contends
that the outstanding amount is towards the tax component levied on the said
invoices. In the present case, we have not been called upon to adjudicate as to
whether the liability to pay the taxes is on the Petitioner or Respondent No. 1.
This question would have to be determined inter se Petitioner and Respondent
No. 1, in appropriate proceedings, having regard to the terms and conditions of
the lease agreement and in particular the Clause 13, extracted in the foregoing
paragraphs. Here, we are only concerned with respect to the prayer made in the
present petition seeking a direction to Respondent No. 2 (Principal Chief Com-
missioner of GST and Central Excise) to furnish the information sought for by the
Petitioner. Concededly, as the owner/landlord of the property in question, Peti-
tioner was required to register itself, and discharge the service tax liability from
the date it was covered under the threshold limit applicable to service tax. Like-
wise, under the CGST Act, 2017, renting of certain immovable properties is treat-
ed as taxable services. Here also it is the Petitioner who has the obligation to dis-
charge the GST liability. The service tax/GST paid on the rent can be availed as
Input Tax Credit for utilisation against outgoing payments, provided, however,
the criteria for availing Input Tax Credit is met. However, the availment of credit
of the taxes paid by the Lessee does not affect the liability of the registered tax-
payer to pay the taxes. In so far as the tax department is concerned, it is the Peti-
tioner who is registered with them and is liable to pay taxes. Under GST, the
point of taxation, that is the liability to pay GST will arise at the time of supply,

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