Case Details: Chennai Citi Centre Holdings Pvt Ltd. vs. Commissioner of GST & Central Excise, Chennai (2025) 34 Centax 132 (Tri.-Mad)
Judiciary and Counsel Details
- S/SHRI Vasa Seshagiri Rao, Member (T) & Ajayan T.V., Member (J)
- Shri Ms. N. Asmitha, Adv
- Shri N. Satyanarayana, Authorised Representative
Facts of the Case
The appellant, engaged in leasing and renting out space in malls, had incurred monthly maintenance and repair charges for the upkeep of the premises and recovered the same from its tenants/lessees. The Department of Revenue classified such reimbursements under the ‘Renting of Immovable Property’ service and demanded service tax thereon for the relevant period. The appellant contended that these charges were not part of rent, but independent reimbursements of expenses incurred for common area maintenance and repairs, and hence could not be subsumed within the taxable service of ‘Renting of Immovable Property’. Reliance was placed upon the Coordinate Bench ruling in the appellant’s own case [Final Order No. 41325-41327/2018, dated 25-04-2018 by CESTAT], where it had been held that such reimbursements are not taxable under this category. The matter was accordingly placed before the Customs, Excise and Service Tax Appellate Tribunal (CESTAT).
CESTAT Held
The CESTAT held that maintenance and repair charges collected by the appellant from tenants/lessees could not be subjected to service tax under ‘Renting of Immovable Property’ service as defined under Sections 65(90a) and 65(105)(zzzz) of the Finance Act, 1994. The Tribunal observed that these amounts were strictly reimbursements of expenses incurred by the lessor for common facilities and did not constitute consideration for renting. Applying the ratio of its earlier decision in the appellant’s own case, it concluded that such collections fell outside the scope of the taxable service. Accordingly, the demand was set aside, and the appeal was allowed.
List of Cases Cited
- Chennai Citi Centre Holdings Pvt. Ltd. v. Commissioner – Final Order No.41325-41327/2018, dated 25-4-2018 by CESTAT, Chennai — Followed [Paras 2, 5]
