(1.) This petition seeks declaration of provisions of Section 65 (90a) and Section 65 (105) (zzzz) of the Finance Act, 1994 as ultravires the Constitution.
(2.) Case set out in the petition is that the Petitioner is a public limited company and owner of commercial immoveable property at Parwanoo, District Solan in the State of Himachal Pradesh. It has let out the said property to business entities. It is receiving rent @ Rs. 1,75,000/- per month as per agreement Annexure P.1. The transaction of lease is subject to levy of stamp duty under the Indian Stamp Act, 1899 and is governed by Transfer of Property Act, 1882. The subject matter of property and leasing are covered by field assigned to State legislature and, thus, outside the purview of the Central Legislature.
(3.) In the reply filed on behalf of the Union of India, stand taken is that renting of property was different from sale of goods or transfer of property or conveyance. The transaction is not covered by tax on sale of goods. Providing of service with respect to property was covered by service tax. Other similar transactions of service in relation to property were service of Mandap Keepers (Section 65(105) (m), Pandal Shamiana (Section 65 (105) (zzw), Convention Service (Section 65 (105) (zc), Right to use properties for business purposes under business support service (Section 65 (105) (zzzq). The levy was not covered under Entry 18 not being tax on land or building but only on service element. The tax was connected with land or building but was not on land or building. The levy was also not covered under Entry 45 being not land revenue nor by Entry 49 which contemplated direct tax. Service tax was on consideration received for allowing use of the premises. Under Article 246(1), Parliament had exclusive power to make laws in respect of matters covered under List I including residue entry. As regards retrospectivity, it has been stated that the amendment was clarificatory. The levy was already provided even under un-amended provisions. The object of the amendment was to overcome the judgment of Delhi High Court against which appeal was pending before the Hon'ble Supreme Court. Judgment of Delhi High Court having not become final, the service providers were required to collect tax even if the same could not be collected on account of the said judgment.
ABOUT US "REGENT COMPUTRONICS PVT. LTD." is a Company incorporated in 1991 under the provisions of the Companies Act, 1956. Since its inception to 1995, the Company was busy in carrying out the activities related to various Banks' Job Work..
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