MERWARA ESTATE Vs. COMMISSIONER OF C. EX.

JUDGEMENT

(1.) THE appellants own a hotel and also two gardens, which are situated, just adjacent to the hotel building. They used to book the rooms in their hotel for the purpose of boarding/temporary residence. Hooking was done separately and separate bills, cash memos etc. were raised. However, they were paying service tax on the amount charged against bookings made by them in respect of gardens as 'mandap keeper'. In the show cause notice issued to them on 12 -8 -2005, it was alleged that they provided services of 'mandap keeper' in respect of the premises known as "Merwara Estate" which is the property comprising of both the hotel building as well as the two gardens known as Mughal Garden and Maurya Garden adjacent to the former. The hotel situated in the premises as "Merwara Estate" comprised a total of thirty rooms in two floors. The show cause notice alleged that the service tax was not paid in respect of the hotel charges collected by the applicant. Admittedly, the appellant had paid service tax on the services rendered in respect of the gardens as a 'mandap keeper'. When the matter came before the learned Commissioner (Appeals) it was noted that the appellant could have issued a single bill and there was no reason for them to issue separate bills one for gardens and the other for hotel charges as it was held that by issuing separate bills there was an intention to evade service tax leviable on hotel charges as well. Accordingly, a demand of Rs. 1,06,115/ - was made and an equivalent penalty was imposed on them.

(2.) THE learned PR refers to Section 66 of the Act which defines "mandap" according to which "any immovable property as defined in Section 3 of the Transfer of Property Act, 1882 and includes any furniture, fixtures, light fittings and floor coverings therein let out for consideration for organizing any official, social of business function".

(3.) AFTER hearing both the sides and perusing the record, it appears that the hotel charges collected in a joint premises cannot strictly fall within the four walls of the definition of 'mandap keeper' as hotel has an identity, 'personality' and function quite distinguishable from that of a 'mandap'. It is also brought to our notice that services in respect of gardens have already suffered the tax. While a 'mandap' is not a residential property 'hotel' is used for residence, though temporarily. Unlike in a 'mandap' no public activity can be said take place in the privacy of a hotel room. We, therefore, do not find any reason in bringing out the tentacles of tax from a 'mandap' to a 'hotel room', when the definition is clear and concise. Prima facie, we find ample force in the contentions made before us on behalf of the appellant. We, therefore, waive pre -deposit of duty and penalty as imposed under the impugned order. The interim slay of the impugned order is, therefore, granted as regards the tax and penalty payable under the impugned order during the pendency of this appeal.