CHANDRADAS Vs. AMBALAVAYAL GRAMA PANCHAYATH

JUDGEMENT

(1.) Petitioners seek to quash Exts.P6 to P11 orders and to declare that they are not liable to pay service tax amounts as claimed in the said impugned orders.

(2.) The petitioners are tenants of shop rooms constructed by the 1st respondent-Panchayat. They have executed Lease Deeds with the Panchayat and have renewed the same from time to time, as evidenced by Exts.P1 to P5. The 1st respondent has now issued notices to the petitioners requiring them to pay service tax for the period from 01.06.2007 to 31.03.2012. The said demand is illegal and unsustainable, contend the petitioners.

(3.) Respondents 1 and 2 filed counter affidavit. According to respondents 1 and 2, the petitioners are liable to pay service tax along with monthly rent. The Government ordered to collect service tax from the petitioners. The Panchayat received the order only in December, 2011. Therefore, service tax for the years from 2007 could not be collected in time. The Panchayat had issued notice to tenants. Only two tenants paid the service tax. In the circumstances, the Panchayat paid the tax from its funds, to the Central Excise Department. The Panchayat is entitled to recoup the said amount from the petitioners.