Friday, April 24, 2009

Govt To Move SC On Service Tax On Commercial Rent - April 24, 2009

The Delhi High Court has struck down the levy of service tax by the Centre on rented property for commercial use. The Court holds that renting the real estate for commercial use by itself is not a service and that''s why it cannot be taxed. This verdict will put an impact on similar cases filed in other high courts across the country.

The finance ministry has imposed service taxes on the rented property in order to add revenue. The move will give a major relief to realtors and all companies operating from rented space, particularly retailers and call centres. However, the Supreme Court will now look after this battle.

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