Flower Marketing Committee v. CCE

FINANCE ACT, 1994

--Renting of Immovable Property Service--Providing phars/tin sheds on charging of a licence feeLeviability----Where both the conditions provided in the definition of renting of immovable property were being satisfied, the activity of renting by providing phars/tin sheds used for carrying out business or commerce would fall under the category of Renting of Immovable Property service.--Assessee was allotted land in flower marketing yard by Agricultural Marketing Board for facilitating traders/retailers in the business of purchase and sale of flowers. It further rented that yard by providing phars/tin sheds on charging of a licence fee. Revenue raised the demand of service tax on lease fee/rent collected on the said activity under the category of renting of immovable property service. Assessee contended that under section 66D, the activity pertaining to agricultural and local bodies was exempted from the levy of service tax. Held: Since both the conditions provided in the definition of renting of immovable property were being satisfied, the activity of renting by providing phars/tin sheds used for carrying out business or commerce would fall under the category of Renting of Immovable Property service. Further, assessee was a body not a local authority and provisions of section 66D was only applicable to agriculture land used for agriculture or for its producers but not for shops which were used for carrying out business or commerce.