1. The facts leading to filing of these two appeals are, in brief, as under:

1.1 The appellant M/s. Greater Noida Industrial Development Authority is a body corporate established under U. P. Industrial Development Act, 1976 to develop the defined area as a planned industrial township. The appellant discharges the statutory duties and functions which, include allotment of land on lease basis. The appellant also provides municipal services in the Greater Noida, which has been notified as an industrial township by the Government of U.P. In terms of Section 6 of the U.P. Industrial Area Development Act, 1976, the function of the Appellant is to secure the planned development of the industrial development area and for this purpose, prepare plans for development, demarcate and develop sites for industrial, commercial and residential purposes according to the plan, providing infrastructure for industrial, commercial and residential purposes, providing amenities regulating erection of buildings and setting up of industries, allocation and transfer by way of sale or lease or otherwise, of the plots of land for industrial, commercial or residential purposes, etc. In terms of Section 7 of the above Act, the Appellant may sell, lease or otherwise transfer, whether by auction, allotment or otherwise, any land or building belonging to the Authority in the industrial development area on such terms and conditions as it may think fit to impose. Under section 11 of the Act, the Appellant is authorized to levy tax for the purpose of maintaining or continuing any amenities in the industrial development area which includes roads, water supply, sewerage, drainage, etc. Accordingly, the Appellant has allotted plots of land to various persons by way of sale or lease for industrial, commercial or residential purposes. The appellant is registered for payment of Service Tax on renting of immovable property services and sale of space for advertising and the appellant since 01.06.07, is paying service tax on rent received from the constructed immovable properties rented out by it for business or commerce. However, during the period of dispute, it was not paying any service tax on the rents received for allotment of plots of vacant land to various persons on lease basis for industrial or commercial purposes.

1.2 Under Section 65(105)(zzzz) introduced w.e.f. 1.6.2007, service provided to any person by any other person, by renting of immovable property or any other service in relation to such renting, for use in the course of, or for furtherance of business or commerce became taxable. Explanation-I to Section 65(105)(zzzz) defines the sub-clause immovable property and it excludes

(a) Vacant land solely used for agriculture, aquaculture, farming, forestry, animal husbandry, mining purposes;

(b) Vacant land whether or not having facilities clearly incidental to the use of such vacant land;

(c) Land used for educational, sports, circus, entertainment and parking purposes; and

(d) Land used solely for residential purposes and buildings used for the purposes of accommodation, including hotels, hostels, boarding houses, holiday accommodation, tents, camping facilities.

The definition of the term immovable property mentioned four types of immovable properties as covered by this term. However, w.e.f. 1.7.2010, a clause (V) was added to the definition of immovable property, which covers vacant land given on lease or licence for construction of building or temporary construction at a later stage to be used for furtherance of business or commerce. At the time of amendment, the Tax Research Unit of Central Board of Excise & Customs (Department of Revenue) vide Circular dated 26.02.2010 clarified that suitable amendment in the definition of taxable service relating to renting of immovable property is being made so as to provide that tax would be charged on rent of a vacant land if there is an agreement or contract between the lessor and the lessee that construction on such land is to be undertaken for furtherance of business or commerce during the tenure of the lease. This clarification also mentions that it has been reported that in many states, the local industrial corporations or PSUs or even private organizations rent vacant land on long term leases with an explicit understanding that lessee would construct factory or commercial building on that land, that in such cases, the ownership of the land is not transferred to the lessee and thus, it is a service provided by the lessor to the lessee, that the situation is similar to renting out a constructed structure for commercial purposes except that at the time of executing the lease agreement the land is in vacant state and that later the lessee constructs commercial structure thereon after executing the lease deed and that while earlier, such lease agreements escaped service tax because of the exclusion clause in the definition of immovable property, the same have become taxable now.

1.3 The expression renting of immovable property is defined in Section 65(90a) and according to this definition, this expression includes - renting, letting, leasing, licensing or other similar arrangements of immovable property for use in the course or furtherance of business or commerce but does not include

(i) renting of immovable property by a religious body or to a religious body; or

(ii) renting of immovable property to an educational body, imparting skill or knowledge or lessons on any subject or field, other than a commercial training or coaching centre.

Explanation-I to Section 65(90a) clarified that

for the purpose of this clause, for use in the course or furtherance of business or commerce includes use of immovable property as factories, office buildings, warehouses, theatres, exhibition halls and multiple use buildings. Explanation-II to this Section clarified that for the removal of doubts, it is hereby declared that for the purposes of this clause, renting of immovable property includes allowing or permitting the use of space in an immovable property, irrespective of the transfer of possession or control of the said immovable property.

1.4 The officers of the Directorate General of Central Excise Intelligence initiated inquiry against the appellant and found that while in their balance sheet for 2010-2011, the appellant have shown income from leasing of vacant land for the purpose of construction of commercial buildings, they have not paid any service tax on the lease rent received by them. The Investigating Officers were of the view that allotment of vacant land by the appellant on lease basis to various persons for construction of commercial building is covered by the definition of renting of immovable property under Section 65(105)(zzzz) read with Section 65 (90a) and accordingly, the same would be taxable w.e.f. 1.7.2010. Since during the period from 1.7.2010 to 31.5.2011, the appellant had received a total amount of Rs.40,14,15,820/- as lease charges from the allotment on lease basis of various plots of land for commercial purposes, a show cause notice dated 19.3.2012 was issued to the appellant for :

(a) demand of service tax including education cess amounting to Rs.4,13,45,830/- on the amount of rent received from the lease of plots of land for commercial purpose during the period July, 2010 to May, 2010 under proviso to Section 73(1) of the Finance Act, 1994 along with interest thereon under Section 75 ibid; and

(b) imposition of penalty on the appellant under Section 77(1)(C) and 78 of the Finance Act, 1994.

1.5 The above show cause notice was adjudicated by the Commissioner of Central Excise and Service Tax, Noida vide order-in-original dated 19.07.2012 by which the above mentioned service tax demand was confirmed against the appellant along with interest thereon under Section 75 and besides this, while penalty of equal amount was imposed on the appellant under Section 78 of the Finance Act, 1994, another penalty of Rs.200/- per day for each day starting from the first day after the due date was imposed under Section 77(1)(c) ibid for the appellants failure to furnish the required information and produce the documents before the investigating officers during the inquiry. Against the above order of the Commissioner, Appeal No.ST/3256/2012 has been filed.

1.6 Subsequent to the issue of show cause notice dated 19.03.2010 by the Addl. Director of General, DGCEI, New Delhi, the officers of the Central Excise Commissionerate, Noida initiated inquiry in respect of the appellant, in course of which financial records for the period from 2006-2007 to 2010d-2011 were obtained and examined. This inquiry was initiated to ascertain as to whether the appellant were paying service tax on the services of the renting of immovable property for the period from 1.6.2007 when the service had become taxable. The Investigating Officers after inquiry with the authorized representative of the appellant and also examining the data and information submitted by them, were of the view that the amount collected and shown by the appellant in their books of accounts from commercial, industrial and builder GHS lease, lease rent (annual), and also the amount received for processing and building plan fees, transfer charges, documentation charges and as misc. income would attract service tax under Section 65(105)(zzzz) read with Section 65(90a) of the Finance Act, 1994. Since the appellant during the period from 2006-07 (1.6.2007 to 31.03.2012) had received an amount of Rs.14,60,25,26,232/- under the above heads from their customers/allotees, the department was of the view that service tax amounting to Rs.140,74,64,342/- would be chargeable on this amount along with interest. Accordingly, a show cause notice dated 17.10.2012 was issued to the appellant for recovery of the above mentioned amount of service tax from the appellant along with interest thereon under Section 75 of the Finance Act, 1994 and also for imposition of penalty on them under Sections 76, 77 and 78 ibid. This show cause notice was adjudicated by the Commissioner of Central Excise and Service Tax, Noida vide order-in-original dated 30.04.2013 by which he confirmed the service tax demand of Rs.140,74,64,342/- against the appellant under proviso to Section 73(1) of the Finance Act, 1994 along with interest thereon under Section 75 ibid and besides this, he imposed penalty of equal amount on him under Section 78 and penalty of Rs.200/- per day was imposed starting from the day on which the tax became payable till the date upto which the failure to pay the tax continued under Section 76 of the Finance Act, 1994.Against this order of the Commissioner, Appeal No.ST/59067/2013 along with stay application No.ST/59745/2013 have been filed. The misc. application No.ST/Misc./61063/ST has been filed for early hearing of the appeal.

2. The misc. application for early hearing was heard on 22.04.2014 and the Tribunal vide misc. order No.51470/2014 dated 22.04.2014 allowing the misc. application ordered for hearing of the appeal No.ST/59067/2013 along with appeal No.ST/3256/2012 on 20.05.2014, as one of the contentions of the appellant is that the show cause notice dated 17.10.2012 which was adjudicated by the Commissioner vide order-in-original dated 30.04.2013 confirming service tax demand of Rs.140,74,64,342/- also includes the service tax demand of Rs.4,13,45,830/- raised vide the DGCEI, show cause notice dated 19.03.2012, which was adjudicated by the Commissioner vide order-in-original dated 16.07.2012.

3. Both the appeals were heard for final disposal on 29.05.2014 and thereafter on 03.06.2014 and 06.06.2014.

4. Shri J.K. Mittal, Chartered Accountant, ld. Counsel for the appellant, appearing for the appellant made the following submissions:

(i) Since the second show cause notice dated 17.10.2012 which covers the entire period from 1.6.2007 to March, 2012, has been issued in respect of the same transactions and on the same basis as the first show cause notice dated 19.3.2012, the second show cause notice dated 17.10.2012 is nonest and, therefore, the adjudication order dated 30.04.13 is also illegal. In this regard, the appellant relies upon the Tribunals judgments in the cases of CCE, Indore Vs. Siddarth Tubes Ltd. reported in 2004 (170) ELT 331 , Bridgestone India Pvt. Ltd. Vs. CCE, Indore reported in 2013 (294) ELT 601 and Shreeji Colourchem Industries Vs.CCE reported in 2013 (294) ELT 615.

(ii) The first assessment by the impugned order dated 16.07.2012 was for the period from 01.07.2010 to 31.05.2011 whereas the second assessment made by the impugned order dated 30.04.2013 also covers the same period, which is not permissible under the law as the department has no powers to review under the law.

(iii) Admittedly, the second show cause notice dated 17.10.2012 has been issued taking the figures obtained from the balance sheets provided by the appellant and as per the computation in Annexure-A to the show cause notice, based on the figures from the schedule 19, 25, 26 and 29 of the balance sheets. Though explanation was furnished by the appellant to the department under letters dated 14.5.2012 and 18.05.2012, regarding the amounts received by the Appellant under different schedules including the miscellaneous receipts, there is no analysis of the same either in the show cause notice or in the adjudication order dated 30.04.2013.

(iv) The show cause notice dated 17.10.2012 and the adjudication order dated 30.04.2013 adjudicating the same are vague without giving any material particulars and lack details and are without any substance. In para-10 of the said show cause notice, it is alleged that from the above, it appears that the party is providing renting of immovable propertyservice inasmuch as they are allotting commercial and industrial land on lease basis for consideration of the rent. Thus, the allegation is only in respect of the allotting land on lease basis. The finding given on internal page 49 and 53 of the impugned order is also that the Appellant is allotting land on lease basis for consideration. However, in the show cause notice dated 17.10.2012, the receipt in respect of the rental of constructed property and on which the service tax is being paid since 1.6.2007 has also been included for charging tax and not only this, the other receipts such as rent as received from the staff, RTI fee, transfer charges, road cutting charges, building plan approval charges, penalty, etc. have also been included in the assessable value for the purpose of charging service tax. In the show cause notice dated 22.03.2012, it has been stated that service tax on leasing of vacant land for construction of building for commercial purposes, become taxable w.e.f. 01.07.2010 and in this regard, the Boards Circular No.334/1/2010-TRU dated 26.02.2010 has also been cited. When in the show cause notice dated 22.03.2012, the department itself has accepted that renting of vacant land for subsequent construction of buildings for commercial purposes became taxable w.e.f. 01.07.2010 only, the issue of show cause notice dated 17.10.2012 charging service tax on the renting of vacant land for construction of building for commercial purposes for the period from 01.06.2007 i.e. period prior to 01.07.2010, is contrary to the provisions of the law and also the stand taken by the department in the first show cause notice. It is settled law that the department cannot be allowed to take stand against its own circular. In fact, the second show cause notice dated 17.10.2012 and the adjudication order dated 30.04.2012 adjudicating the same are contrary to the Tribunals order dated 11.12.2013 in Appeal No.ST/57840/2013, wherein it has been held that no service tax would be applicable prior to 01.07.2010 on vacant land given on lease basis for construction of building for commercial purposes.

(v) While in the first show cause notice dated 22.03.2012, the service tax has been demanded only on the annual rental in respect of the leasing of the vacant land for construction of building for furtherance of business or commerce and not on premium rent received from the allotee, the second show cause notice dated 17.10.2012 also demands service tax on the premium amount received from the allotees. The demand of service tax on the premium amount in the second show cause notice dated 17.10.2012 and confirmation of service tax demand on the same is totally wrong, as the premium is the value of the land on which the stamp duty is paid and the same cannot be subjected to the service tax.

(vi) The appellant is a public authority and instrument of the statute for executing statutory duties / providing municipal services as notified by notification dated 29.12.2001 issued by the Governor in terms of Article 243Q of the Constitution of India. The Ministry of Finance vide Circular No.96/7/07 dated 23.08.2007 (para-999.01) has clarified that the activities assigned to and performed by the Sovereign public authority under the provisions of any law are statutory duties performed purely in public interest and the same are not to be treated as services for consideration. Therefore, the allotment of land by the appellant on lease basis to various persons for construction of building for business or commerce cannot be treated as renting of immovable property and subjected to tax.

(vii) The term lease appearing in the definition of renting of immovable property given in Section 65(90a) is not defined in Finance Act, 1994 and, therefore, the same has to be construed in popular sense i.e. the sense in which the people conversant with the subject matter understand this term. The term lease used in Section 65(90a) cannot include perpetual leases, which are long term leases and which virtually involve transfer of ownership of land against full consideration on which stamp duty has been paid. Such transfer of land by allotment would not be covered by the definition of renting of immovable property and as such, the provisions of Section 65 (105)(zzzz) read with Section 65(90a) of the Finance Act, 1994 would not be attracted. The Honble Delhi High Court in the case of KRIBHCO Vs. Dy. Commissioner of Income Tax (order dated 12.07.2010) in ITA No.205/2010 has held that premium received for long term lease of 90 years is not an advance rent, as such long term lease virtually creates ownership rights in favour of the lessee. The Apex Court in the case of R. K. Palshilkar (HUF) Vs. Commissioner (1988) 3 SCC 594 )] has held that long term lease for 90 years of agricultural land amounted to its transfer within the meaning of Section 12 B of the Income Tax Act and hence and profit and gains arising from the lease transferred would be taxable under the head capital gains.

(viii) Though the renting of immovable property became taxable under Section 65(105)(zzzz) read with Section 65(90a) of the Finance Act, 1994 w.e.f. 1.6.2007, the vacant land has been specifically excluded under clause (b) of the Explanation II to Section 65 (105)(zzzz). It is only w.e.f. 1.7.2010, that the vacant land given on lease or licence for construction of building or temporary structure at a later stage to be used for furtherance of business or commerce, became taxable. Therefore, during the period prior to 1.7.2010, leasing of vacant land for any purpose was not taxable at all and w.e.f. 1.7.2010, the renting/leasing of vacant land became taxable only when the land has been given on lease or licence for construction of building or temporary structure at a later stage to be used for furtherance of business or commerce. In the show cause notice the service tax is sought to be charged even on lease of the vacant land, which was not to be used for construction of building, or temporary structure for furtherance of business or commerce.

(ix) Moreover, when the taxing event is renting of certain type of immovable property which became taxable w.e.f. 1.6.2007, the lease agreements executed prior to the date of levy would not come within the tax net, whereas it is an admitted fact that figures have been taken from the balance sheet of the appellant without considering that the taxable event which has took place prior to 1.6.2007 could not be subjected to the levy of service tax merely by taking the figures from the balance sheet. In this regard, the appellant relies upon the judgment of the Apex Court in the case of Collector of Central Excise Vs. Vazir Sultan Tobacco Co. Ltd. reported in 1996 (83) ELT 3 (SC) and the Tribunals decision in the case of Vistar Construction Pvt. Ltd. reported in 2013 (31) STR 129 (Delhi).

(x) Both the show cause notices have been issued by invoking the extended period under proviso to Section 73(1) of Finance Act, 1994, which can be invoked only on the ground of wilful suppression of facts, mis-statement, fraud, or contravention of the provisions of Finance Act, 1994 or of the rules made thereunder with intent to evade the tax. It is undisputed fact that appellant is a public authority doing its activity in full public view and was already registered under the Service Tax and was paying service tax on renting of constructed property. The appellant under bonafide belief that perpetual leases of vacant land for 90 years given by public authority would not come within the purview of the renting of immovable property, did not pay service tax on the lease rent received from such allotments of land on such long term lease basis. The question as to whether such leases would attract service tax under Section 65(105)(zzzz) read with Section 65(90a) of the Finance Act, 1994 is a highly disputed fact based on interpretation of law and hence in such circumstances, the appellant could not be accused of fraud, wilful mis-statement, suppression of facts with intent to evade payment of duty. Therefore, in any case, the service tax can be recovered only for normal limitation period of one year from the relevant date. For the same reason, penalty would not be imposable under Sections 76, 77 and 78 of the Act.

5. Shri Amresh Jain, the learned DR, made the following submissions.

(i) The issue as to whether the long term lease of immovable propertyare covered by Section 65(105)(zzzz) read with Section 65(90a) stands decided by the Tribunal in favour of the department vide Final Order No.ST/A/58664 of 2013 dated 11.12.2013 in Appeal No.ST/57252 of 2013 filed by New Okhla Industrial Development Authority Vs. CCE & ST, Noida, wherein in para-5 of the judgment, the Tribunal has held that in absence of any restrictive signification in Section 65(105)(zzzz) of a legislative intent to exclude long term leases of immovable propertyfrom the purview of the taxable service defined and enumerated in said provision, there is no authority to hold that the so-called long term lease are outside the purview of the taxable service of renting of immovable property covered by Section 65(105)(zzzz) read with Section 65(90a).

(ii) The service tax would be chargeable not only on the amount of lease rent but also on the amount of premium if any collected in addition to the lease rent.

(iii) The service tax under Section (65)(105)(zzzz) read with Section 65(90a) is chargeable on all the amounts received as per schedule 19 of the balance sheet [amounts received for commercial, industrial and builder GHS leases], Schedule 25 of the balance sheet [amounts received against lease rent (annual)], Schedule 26 of the balance sheet [amounts received for processing and approval of building plan, transfer charges, documentation charges, etc] and Schedule 29 of the balance sheet [amounts received as rent and misc. income].

(iv) In both the cases, the extended period under proviso to Section 73(1) of the Finance Act, 1994 would be invokable for payment of service tax inasmuch as

(a) The appellant had not registered themselves for payment of service tax on the service of renting of immovable property being provided by them;

(b) They did not file Return incorporating the value of the above services;

(c) They mis-stated the income from the taxable services inasmuch as while the income from renting of immovable property was disclosed in the balance sheets in Schedules- 19,25, 26 and 29, the same was not reflected in the ST-3 Returns; and

(d) The appellant contravened the provisions of Section 66 of Finance Act, 1994 read with Rules-4, 5, 6 and 7 and Service Tax Rules, 1994 with intent to evade the payment of service tax.

In view of this, both the demands have been correctly confirmed by invoking the extended period of 5 years from the relevant date. For the same reasons, penalties under Section 78 and also under Section 77 has been correctly imposed.

6. We have considered the submissions from both the sides and perused the records.

7. The Appellant - M/s. Greater Noida Industrial Development Authority, is a statutory body constituted under Section 3 of U.P. Industrial Area Development Act, 1976 to develop the defined area as a planned industrial township. Under Section 3 of the U. P. Industrial Area Development Act, 1976, the State Government may, by notification, constitute for the purposes of this Act, an authority for planned development of an industrial development area and the authority shall be a body corporate and shall consist of a Chairman who is to be an officer of the rank of the Secretary to the Government of U.P. By notification issued under Article 243 Q(1) of the Constitution of India, the Greater Noida Industrial Development Area has been notified as industrial township w.e.f. 29.12.2001. The appellant in terms of Section 6 of the U. P. Industrial Area Development Act, 1976 performs various functions like

(a) Acquiring land in the industrial development area by agreement or through proceedings under Land Acquisition Act, 1984 for the purposes of this Act;

(b) Preparing plans for the development of the industrial development area;

(c) Providing infrastructure for industrial, commercial or residential purposes;

(d) Providing various amenities;

(e) Providing infrastructure for industrial, commercial or residential purposes;

(f) Regulating the allocation of building and setting up of industries;

(g) Allocating and transferring either by way of sale or lease or otherwise, plots of land for industrial, commercial or residential purposes;

The appellant in course of discharge of its functions had allocated vacant land to various persons for residential/ group housing, institutional, commercial or industrial purposes on 90 years lease term basis. In respect of such allotment of vacant land for residential, institutional, commercial or industrial purposes, the appellant, in addition to an amount called premium also collects lease rent. There is no dispute that all such allotments of vacant land are on 90 years lease basis. Besides this, the appellant have also rented the constructed building for business/commercial purposes in respect of which they are paying service tax on the rent since 1.6.2007. They also provide mandap keeper services and sale of space for advertisement in respect of which they also have been paying service tax. The dispute in these appeals is only in respect of lease of the plots of vacant land, which according to the department, would attract service tax under Section 65(105)(zzzz) read with Section 65(90a) of the Finance Act, 1994. The first show cause notice dated 22.03.2012 issued by the Addl. Director General, DGCEI, New Delhi, for the service tax demand of Rs.4,13,45,830/- for the period 1.7.2010 to 31.5.2011 is confined only to the allotment of the vacant land on lease basis, which according to the Department, had become taxable under Section 65(105)(zzzz) read with Section 65 (90a) w.e.f. 1.7.2010 when such vacant land had been given on lease or licence for construction of the building or temporary structure at later stage to be used for furtherance of business or commerce. This first show cause notice was adjudicated by the Commissioner of Central Excise, New Delhi vide order-in-original dated 16.07.2012 by which the entire demand of Rs.4,13,45,830/- was confirmed along with interest. The second show cause notice dated 17.10.2012 issued by the Commissioner of Central Excise and Service Tax, Noida covers the period from 1.6.2007 to March, 2012 and in this show cause notice, the service tax of Rs.140,74,64,342/- has been demanded along with interest on

(a) One time premium amount in respect of vacant land given on 90 years lease basis;

(b) Annual lease rent for vacant land given on 90 years lease basis;

(c) Fee charged for examination of the applications received for allotment of land and also the fee charged from the allotees for getting their building plan approved;

(d) Transfer charges charged when the original allotee transfers the land to others;

(e) Rent received from the staff to whom the residential units of the Appellant had been let out;

(f) Other misc. incomes such as compliance fees, map revision fee, map validation fee, penalty, forfeiture charges, restoration charges, documentation charges, etc; and

(g) Misc. income such as malba charges, RTI fee, Penalties from contractors, water usage charges, rain water harvesting, time extension charges, etc.

8. The main points to be decided in these appeals are, thus, as under:

(a) Whether in respect of giving vacant land on lease or licence basis for construction of building or temporary structure at a later stage to be used for furtherance of business or commerce, service tax under Section 65(105)(zzzz) read with Section 65 (90a) of the Finance Act, 1994 is chargeable from 1.06.2007 or the same is chargeable only w.e.f. 1.7.2010 when clause (V) was added to Explanation-I to Section 65(105)(zzzz) and in this regard, whether long term leases of vacant land are excluded from the preview of section 65(105)(zzzz) read with section 65(90a).

(b) Whether service tax is chargeable only on the lease rent or also on the one time premium amount charged in respect of long term leases;

(c) Whether service tax under section 65(105)(zzzz) read with Section 65(90a) is chargeable on lease of vacant land to builders / Group Housing Societies for construction of residential complex

(d) Whether service tax is chargeable on the processing and building plan fee, and transfer charges

(e) Whether service tax is chargeable on other miscellaneous income such as compliance fee, map revision fee, map validation fee, forfeiture charges, penalty, restoration charges, documentation charges, malba charges, RTI fee, etc.

(f) Whether amount received from the staff to whom the residential units have been let out would also attract service tax under Section 65 (105)(zzzz)

(g) Whether the service tax demand of Rs. 4,13,45,930/- for period from 01.07.2010 to 31.05.2011 confirmed vide Order-in-original dated 19.07.2012 is included in the service tax demand of Rs. 140,74,64,343/- for the period from 01.06.2007 to 31.03.2012 confirmed vide Order-in-original dated 30.04.2013

(h) Whether the extended period of five years from the relevant date under proviso to Section 73(1) of Finance Act, 1994 would be invokable for recovery of service tax or the above service tax demand would be confined only to the normal limitation period of one year from the relevant date

(i) Whether penalty under Section 76, 77 and 78 is imposable on the Appellant

8.1. Our findings on the above points are as under.

9. Whether in respect of giving vacant land on lease or rent for construction of building or a temporary structure at a later stage to be used for furtherance of business or commerce would attract service tax under section 65(105) (zzzz) read with Section 65 (90a) from 1.6.2007, the date on which the service tax on renting of immovable propertyhad become leviable or the same is chargeable w.e.f. 1.7.2010 when clause (v) was added to the inclusive portion of the definition of immovable property in Section 65 (105)(zzzz) and whether for this purpose, the long term leases of vacant land are excluded from the purview of Section 65(105(zzzz) read with Section 65(90a) of the Act.

9.1 The question as to whether giving vacant land on lease, lease or rent for construction of a building or temporary structure at a later stage for furtherance of business or commerce is taxable from 1.6.2007, the date on which the service tax on renting of immovable propertyhad been introduced or w.e.f. 1.7.2010 when Clause (v) had been added to the Explanation-I to Section 65(105)(zzzz) has been examined by this Tribunal in detail in its Final Order No.ST/A/58664/2013-CU(DB) dated 11.12.2013 in the case of New Okhla Industrial Development Authority Vs. Commissioner of Customs, Central Excise & Service Tax, Noida wherein it was held that since prior to 01.07.2010, vacant land solely used for agriculture, aquaculture, farming, forestry, animal husbandry and mining purposes, vacant land used for educational, sports, circus, entertainment and parking purposes and vacant land whether or not having facilities clearly incidental to the use of such vacant land was excluded from the definition of term immovable property under the exclusion clause of Section 65(105)(zzzz) and since only w.e.f. 1.7.2010, a clause (v) was added to Explanation I defining the term immovable property and this newly introduced clause covered vacant land given on lease or licence for construction of a building or a temporary structure at a later stage for furtherance of business, the giving of vacant land on lease or licence for construction of a building or a temporary structure at a later stage to be used for furtherance of business or commerce would become taxable only w.e.f. 1.7.2010 and not during the period prior to 1.7.2010. In this regard paras 9, 10, 11, 12, 13, 14 and 15 are reproduced below:

9. The other substantive issue presented for analysis is whether renting of vacant land by the appellant to a third party, albeit for a business or commercial purpose falls within the ambit of the taxable service, prior to 1.7.2010 i.e. before introduction of clause (v) in Explanation (1) to Section 65(105)(zzzz). To answer this issue, it is necessary to consider the legislative dynamics of the provision. To the extent relevant and material for the purposes of this lis, suffice it notice that prior to 1.7.2010, clause (zzzz) of Section 65(105) read as follows : Taxable service is a service provided or to be provided:

to any person, by any other person, by renting of immovable propertyor any other service in relation to such renting, for use in the course of or for furtherance of, business or commerce.]

Explanation 1. For the purposes of this sub-clause, immovable property includes

(i) building and part of a building, and the land appurtenant thereto;

(ii) land incidental to the use of such building or part of a building;

(iii) the common or shared areas and facilities relating thereto; and

(iv) in case of a building located in a complex or an industrial estate, all common areas and facilities relating thereto, within such complex or estate, but does not include

(a) vacant land solely used for agriculture, aquaculture, farming, forestry, animal husbandry, mining purposes;

(b) vacant land, whether or not having facilities clearly incidental to the use of such vacant land;

(c) land used for educational, sports, circus, entertainment and parking purposes; and

(d) building used solely for residential purposes and buildings used for the purposes of accommodation, including hotels, hostels, boarding houses, holiday accommodation, tents, camping facilities.

Explanation 2.- For the purposes of this sub-clause, an immovable propertypartly for use in the course or furtherance of business or commerce and partly for residential or any other purposes shall be deemed to be immovable propertyfor use in the course or furtherance of business or commerce;

Section 75 of the Finance Act 2010 introduced several amendments to Chapter V of the Act. In so far as Section 65(105) (zzzz), the 2010 amendments substituted the main provision of sub-clause (zzzz) and enjoined this substitution to operate with retrospective effect from 1.6.2007. Sub-clause (v) was also introduced, to Explanation (1) in the provision. This sub-clause reads:

vacant land, given on lease or license for construction of building or temporary structure at a later stage to be used for furtherance of business or commerce.

10. While the assessee contends that a lease of vacant land (for construction of a building or a temporary structure at a later stage to be used for furtherance of business or commerce) is a taxable service only since 1.7.2010; according to Revenue clause (v) in Explanation 1 merely clarifies the clear and implicit intent of clause (zzzz).

11. In our considered view, clause (zzzz) of Section 65(105), prior to 01.07.2010 does not embrace renting of land within scope of the enumerated taxable service. On true and fair construction of the main part of clause (zzzz) it is clear that renting of any immovable propertyfor use in course for furtherance of business or commerce is the taxable service and this would clearly include a lease of vacant land as well. Explanation 1 to this clause (prior to the amendatory exercise in 2010) signaled, through the inclusionary clause various facets of transactions which would also amount to renting of immovable property. On established principles of statutory interpretation, normally an inclusionary clause does not limit the plentitude of an enacting provision couched in broad terms. Thus the illustrations of what are immovable property, set out in the inclusionary clause in Explanation 1 would not derogate from vacant land being comprehended within the expression renting of immovable property However, clause (zzzz) has an exclusionary clause as well, enumerating the subjects excluded from the ambit of immovable property. Under this exclusionary dispensation; in sub-clause (a) vacant land solely used for agricultural, aquaculture. farming, forestry, animal husbandry, mining purposes; in sub-clause (b) vacant land, whether or not having facilities clearly incidental to the use of such vacant land; and in sub-clause (c) land used for educational, sports, circus, entertainment and parking purpose, are excluded from the purview of immovable property. On a true and fair construction of the exclusionary clause, the legislative intent is compelling that vacant land whether having facilities clearly incidental to its use as such or otherwise does not constitute immovable property. As a consequence of the interplay between the enumeration of renting of immovable propertyas the taxable event read with the inclusionary and exclusionary clauses (in particular sub-clause (b) of the exclusionary clause) in Section 65 (105)(zzzz), renting of vacant land was clearly outside the purview of the taxable service, prior to 01.07.2010.

12. Introduction of sub-clause (v) in Explanation I has significantly altered and extended the scope of the taxable service, with effect from 1.7.2010 and consequently vacant land given on lease or licence, for construction of a building or a temporary structure, to be used at a later stage for furtherance of business or commerce, would be immovable property and renting of this immovable propertywould be the taxable service, since 01.07.2010.

13. In view of clear exclusion of vacant land from the ambit of immovable propertyprior to 1.7.2010 it cannot gainfully be contended by Revenue, that clause (v) to Explanation I (introduced in 2010), was a mere clarificatory endeavour, explicating the implicit and inherent meaning of Section 65 (105)(zzzz). Clause (v) is clearly an amendment which expands the scope of the taxable service; and prospectively.

14. Clause 75 of the Bill (which later came to be enacted as Finance Act, 2010) has proposed insertion of sub-clause (v) in Explanation I in Section 65(105)(zzzz) of the Act. The memorandum explaining the provisions in Finance Bill 2010 also indicates that the amendments are being made in the definition of renting of immovable property service inter alia levy of service tax on renting of vacant land where there is an agreement between lessor and lessee for undertaking construction of building or structure on such land for furtherance of business or commerce during the tenure of the lease. The Board Circular No.334/2010-TRU, dated 26.2.2010 (in paragraph 3) explains the purpose of the amendments to Section 65(105)(zzzz). Accordingly, the Circular explains that amendments are being made in the definition of this taxable service to provide that renting of vacant land where there is an agreement or contract between the lessor and lessee for undertaking construction of buildings or structures on such land for furtherance of business or commerce during the tenure of the lease, shall be subjected to service tax. The statement of objects and reasons accompanying the Finance Bill, 2010 also clarify that clause 75 of the Bill seeks to amend Chapter V of the Finance Act, 1994; to modify the scope of certain taxable services including the taxable service defined and enumerated in Section 65(105)(zzzz) , of the Act. These several contemporaneous exposition and administrative constructions and the scope of sub-clause (v) of Explanation I in Section 65(105)(zzzz) fortify the conclusion the scope of sub-clause (v). To modify and expand the scope of the taxable service to cover and include vacant land on lease or licence for construction of a building or a temporary construction at a later stage to be used for furtherance of business or commerce, within the ambit of immovable property is thus the taxable service. Since the introduction of this sub-clause in Explanation I expands the scope of the taxable service and renders the taxable (a) hitherto non-taxable transaction, and absent of explicit retrospective reach provided to the amendment and insertion of this sub-clause, , these transactions covered by this sub-clause of the Explanation have only the prospective operation.

15. On the above analysis , renting of vacant land by way of lease or licence (irrespective of the duration or tenure), for construction of a building or a temporary structure for use at a later stage in furtherance of business or commerce is a taxable service only from 1.7.2010, and not so, earlier to this date.

In view of this position, we hold that giving of vacant land on license, rent or lease for construction of structure at a later stage for furtherance of business or commerce became taxable only w.e.f. 1.7.2010 under Clause (v) of Explanation I to Section 65(105)(zzzz) and this activity was not taxable during the period prior to 1.7.2010.

9.2 The other plea of the appellant that the allotment of land by the appellant to various persons is on long term lease basis the leases of 90 years, which amount to transfer of ownership and such leases are outside the purview of Section 65(105)(zzzz) and in this regard, the appellant have relied upon the judgments of the Apex Court in the case of Shanti Sharma & Ors. vs. Ved Prabha & Ors reported in (1987) 4 SCC 193 and also the judgment in the case of R.K. Polshikar (HUF) vs. CIT reported in (1988) 3 SCC 594.

9.2.1 While Section 65(105)(zzzz) provides that service provided to any person by any other person by renting of immovable propertyor any other service in relation to such renting in course of or for furtherance of business or commerce is taxable, Explanation-I mentions as to which immovable properties are included in expression immovable property and which immovable properties are not included in this term. Section 65(90a) defines the term renting of immovable property and according to the definition renting of immovable property includes renting, letting, leasing, licensing or other similar arrangement of immovable propertyfor use in the course or furtherance of business or commerce but it does not include, renting of immovable property by a religious body or to a religious body; or renting of immovable propertyto an educational body, imparting skill or knowledge or lessons on any subject of field, other than a commercial training or coaching centre. Explanation-1 to 65(90a) clarifies that for the purpose of this sub-Section, expression for use in the course or furtherance of business or commerce includes use of immovable property as factories, office buildings, warehouses, theatres, exhibition halls and multiple-use buildings. Explanation - 2 to this sub-Section provides that for the removable of doubts, it is hereby declared that for the purposes of this clause renting of immovable property includes allowing or permitting the use of space in an immovable property irrespective of the transfer of possession or control of the said immovable property.

9.2.2 While the term, lease is not defined in Finance Act, 1994 in term of Section 105 of the Transfer of Property Act, 1882, a lease of immovable property is a transfer of a right to enjoy such property made for a certain time, express or implied, or in perpetuity, in consideration of a price paid or promised, of money, or a share of crops, service or any other thing of value, to be rendered periodically or on specified occasions, to the transferor by the transferee, who accepts the transfer on such terms. Thus, the term lease covers the lease for any period including lease in perpetuity. In terms of Explanation-2 to Section 65(90a), renting of immovable property also includes renting, letting, leasing, licensing or other similar arrangements of immovable property, irrespective of the transfer of possession or control of the said immovable property. Section 65(90a), while defining the immovable property does not make any distinction between the long term lease or short term lease and there is absolutely no provision to exclude the long term lease or lease in perpetuity from the purview of the expression renting of immovable property. Therefore, it is difficult to accept that appellants contention that long term leases or lease in perpetuity are excluded from the purview of Section 65(105)(zzzz) read with Section 65(90a).

9.2.3 The appellant have cited the judgment of the Apex court in the case of Shanti Sharma Vs. Ved Prabha (supra). This judgment is with regard to the provisions of Section 14(1)(e) of the Delhi Rent Control Act, 1958. Section 14(1) of the Delhi Rent Control Act provides that Rent Controller may, on an application made by the landlord in the prescribed manner, order for the recovery of the possession of the premises on the ground as mentioned in Clause (a) to (e). The ground mentioned in clause (e) is that the premises let for residential purposes are required bona fide by the landlord for occupation as a residence for himself or for any member of his family dependent on him, if he is the owner thereof, or for any person for whose benefit the premises are held and that the landlord or such person has no other reasonably suitable residential accommodation. In this case, the house let out by the respondent, Ms. Ved Prabha was built on a leasehold land allotted to her by DDA and it was the plea of the petitioner Ms. Shanti Sharma that the respondent Ms. Ved Prabha holding the plot on the land on leasehold basis cannot be treated as the owner. It is in this background that Apex Court held that while the respondent-landlord is the owner of the structure built on the leasehold land, so far as the land is concerned, since she holds the same on long term lease basis, she will fall within the ambit of the meaning of the term, owner as is contemplated in Section 14 (1)(e). In this case, the Apex Court also observed that meaning of the term owner in Section 14(1)(e) is influenced and controlled by its context and hence, the petitioners construction is not acceptable because it seems to be quite contrary to the reasonable operation of the statutory provisions. Thus, in this case, as observed by the Apex Court itself, the meaning of the word, owner in Section 14(1)(e) is influenced and controlled by its context and, therefore, the ratio of this judgment of the Apex Court is not of universal application and all long term leases cannot be treated as the transactions of the transfer of ownership.

9.2.4 In case of R.K. Polshikar (HUF) Vs. CIT (supra), the petitioner was holding a plot of land on 99 years lease. After developing the said plot, he transferred on long term lease basis to other person against the lump sum amount as premium and in addition to this, an annual lease rent, which was also to be paid in advance. The lessor reserved his right to take back the possession of the land leased if the rent is not paid for two consecutive years. The point of dispute was as to whether income tax (Capital Gains Tax) under Section 12 B of the Income Tax Act would be chargeable on the premium amount. In terms of Section 12 B of the Income Tax Act, the tax shall be payable by an assessee under the head Capital Gains in respect of any profits or gains arising from the sale, exchange, relinquishment or transfer of a capital assets effected after 31.03.86 and such profits and gains shall be deemed to be the income of the previous year in which the sale, exchange, relinquishment or transfer took place. The terms capital asset was defined as property of any kind held by an assessee, whether or not connected with his business, profession or vocation. The Apex Court in this case held that when the petitioner has given his property on long term lease basis for 99 years, it would appear that under the leases in question, he has parted with an asset of enduring nature, viz. the right to possession and enjoyment of the property leased for a period of 99 years subject to certain conditions on which the leases could be terminated and that provisions of Section 12B of the Income Tax Act would be applicable to the income from such leases. Thus, this judgment of the Apex Court is also with regard to the provisions of Section 12B of the Income Tax Act and the ratio of this judgment is that income from transfer of a plot of land on long term basis is to be treated as capital gain income which would be taxable under Section 12B of the Income Tax Act. This judgment is not an authority for the appellants proposition that all long terms lease of land amount to transfer of ownership of land.

9.2.5 We, therefore, hold that all the leases of immovable property as defined in Section 65 (105)(zzzz) would be covered for service tax whether the lease is short term or long term or lease perpetuity. We find that this very issue has also been examined in detail in paras-5, 6, 7 and 8 of the Tribunals judgment in the case of New Okhla Industrial Development Vs. Commissioner of Central Excise & Service Tax, Final Order No.58664/2013 dated 11.12.2013, which are reproduced below:

5. We will deal with the two substantial arguments urged on behalf of the appellant before us. We first take up the issue whether long term leases of immovable property are outside the purview of the taxable service enumerated and defined in Section 65(105) (zzzz). This provision neither marks nor accommodates any distinction between long term and short term leases. On a true and fair construction of this provision it is clear that a service provided in relation to renting of immovable property for use in the course of or in furtherance of business or commerce is the taxable service. The provision does not restrict the ambit of the taxable service to only short term leases nor identifies or classifies leases in terms of the duration. A lease is defined in Section 105 of the Transfer of Property Act, 1882, as transfer of a right to enjoy such property, made for a certain time, express or implied, or in perpetuity, in consideration of a price paid or promised, or of money, a share of crop, service or any other thing of value, to be rendered periodically or on specified occasions to the transferor by the transferee, who accepts the transfer on such terms. In the absence of any restrictive signification in Section 65 (105)(zzzz), of a legislative intent to exclude long term leases of immovable property from the purview of the taxable service defined and enumerated in said provision, we find no authority to hold that long term leases (so-called) are outside the purview of the taxable service renting of immovable property.

6. There is yet another problem in accepting this contention. What is a long term and what a short term lease cannot be an open-ended, ambiguous and inchoate concept. Neither does the relevant provision exclude long term leases from the purview of the definition nor is any authority, statutory or otherwise brought to our attention which provides a guidance to classify leases into long term and short term. We therefore find no justification for a restrictive interpretation of the relevant provision of the Act.

7. Ld. Counsel for the appellant has referred to an interim order of this Tribunal dated 8.11.2012 passed in an appeal preferred by the Greater Noida Industrial Development Authority. While granting waiver of pre-deposit in full, the Tribunal observed that the ordinary meaning of renting will not cover long term leasing. To buttress this prima facie conclusion the Tribunal referred to the decision of the Delhi High Court in Krishak Bharati Co-operative Ltd. vs. Dy. CIT in ITA No.205/2010 dated 12.7.2012. We therefore refer to the context and circumstances in which the decision of the High Court was pronounced. The High Court had answered a question of law framed for its consideration. The question referred was whether amortizing the lease premium paid by the assessee was a capital or a revenue expenditure. After referring to several precedents, the High Court concluded that in the facts and circumstances of the reference before it, the lease premium paid by the assessee was capital and not revenue expenditure. During the course of its analyses, the High Court referred with approval, to the principle delineated by the Patna High Court in Commissioner of Income Tax, Bihar & Orissa v. Visweshwar Singh - [1939] 7 ITR 536 (Patna) wherein Fazal Ali J. (as his Lordship then was) inter alia observed that in some cases where the rent is ridiculously low and the premium abnormally high, it may be possible to argue that the premium includes advance rent. The Delhi High Court observed that characterization of an amount by an assessee whether as premium or as rent is not conclusive and the nature of the amount must be ascertained on consideration of the totality of the facts and circumstances of the case. In the facts before it however, since the annual rent was not very low compared to the premium amount fixed, the Delhi High Court inferred that the premium paid by the assessee amounted to capital and not revenue expenditure. During the course of its analysis, the High Court did observe that the tenure of the lease is quite substantial and virtually creates ownership rights in favour of the lessee, who is at liberty to construct upon the plot. This observation, in our respectful view, neither in its factual context nor otherwise amounts to enunciation of a legal principle of general application, that a long term lease does not amount to a lease.

8. On the analysis above, the contention by the assessee that a long term lease of immovable property does not amount to renting of immovable property does not commend acceptance; and is rejected.

9.2.6. In view of the above discussion, service tax demand would be sustainable only in respect of leases, whether long term or short term, of vacant land for the period w.e.f. 01.07.2010 where such leases of vacant land were for construction of building or structures for furtherance of business or commerce. No service tax would be chargeable in respect of such lease paid prior to 01.07.2010.

10. Whether the service tax is chargeable only on the lease rent or also on one time premium amount charged in respect of long term leases

10.1. A lease is a transaction, which has to be supported by consideration. The consideration may be either premium or rent or both. The consideration which is paid periodically is called rent. As regards premium, the Apex Court in the case of Commissioner of Income Tax, Assam and Manipur Vs. Panbari Tea Co. Ltd. reported in (1965) 3 SCR 811 has made a distinction between premium and rent observing that when the interest of the lessor is parted with for a price, the price paid is premium or salami, but the periodical payments for continuous enjoyment are in the nature of rent, the former is a Capital Income and the latter is the revenue receipt. Thus, the premium is the price paid for obtaining the lease of an immovable property. While rent, on the other hand, is the payment made for use and occupation of the immovable property leased. Since taxing event under Section 65(105)(zzzz) read with Section 65(90a) is renting of immovable property, service tax would be leviable only on the element of rent i.e. the payments made for continuous enjoyment under lease which are in the nature of the rent irrespective of whether this rent is collected periodically or in advance in lump sum. Service tax under Section 65(105)(zzzz) read with Section 65 (90a) cannot be charged on the premium or salami paid by the lessee to the lessor for transfer of interest in the property from the lessor to the lessee as this amount is not for continued enjoyment of the property leased. Since the levy of service tax is on renting of immovable property, not on transfer of interest in property from lessor to lessee, service tax would be chargeable only on the rent whether it is charged periodically or at a time in advance. In these appeals, in the show cause notice dated 19.03.212 issued by the Addl. Director, DGCEI, New Delhi, service tax has been demanded only on the lease rent and not on the premium amount while in the subsequent show cause notice dated 17.10.2012 issued by the Commissioner of Central Excise and Service Tax, Noida, the amount of premium has also been included in the lease rent for the purpose of charging of service tax for which no valid reasons have been given. Therefore, the order-in-original dated 30.04.2013 confirming the service tax demand on the premium amount is not correct and to this extent, the service tax demand would not be sustainable.

11. Whether service tax is chargeable on the processing charges, building plant approved for, transfer charges and on miscellaneous income such as map revision fee, map validation fee, forfeiture charges, penalty, restoration charges, documentation charges, etc. and also on the rent received from the staff to whom the residential premises is let out by the appellant

11.1 Section 65(105)(zzzz) as introduced w.e.f. 1.6.2007 was as under:

Taxable service means service provided or to be provided to any person by any other person, in relation to renting of immovable property for use in the course or furtherance of business or commerce.

Subsequently, by Finance Act, 2001, Section 65(105)(zzzz) was amended retrospectively w.e.f. 1.6.2007 and the amended provisions was as under:

taxable service means any service provided or to be provided to any person by any other person, by renting of immovable property or any other service in relation to such renting for use in the course of or for furtherance of business or commerce.

11.2 Thus, as per the amended provisions effective from 1.6.2007, Section 65(105)(zzzz) covers not only the service of renting of immovable property to any other person for use in the course of furtherance of business or commerce but only any other service in relation to such renting. Therefore, the services, which are in connection with the renting of immovable property for business or commerce, would also be taxable under this Section. Therefore, processing charges for application for land allotment on lease basis would also be taxable. However, the services like processing and approval of building plan, map revision, malba charges connected with building of structures on the land allotted on lease basis have no nexus with the renting of immovable property for business or commerce, and as such, the activities in relation to the construction of building on the vacant land allotted on lease basis i.e. the charges of map approval, validation, map revision, malba charges, etc. would not attract service tax. As regards restoration charges or penalty, which appears to be the penalty for violating the conditions of the lease, the same, in our view, cannot be said to be the consideration for lease and would not attract service tax. As regards the rent/licence fee received by the appellant from their staff to whom the residential units has been let out, such letting out the residential units to the staff is not renting of immovable propertyfor use in or for furtherance of business or commerce and hence, the licence fee/ rent received from such letting out of houses of Noida Authority would not attract service tax.

12. Whether the allotment of vacant land to builders for construction of residential complexes would attract service tax under Section 65(105)(zzzz) read with Section 65(90a).

12.1 In terms of Clause-V to Explanation-I of Section 65(105)(zzzz) which had been introduced w.e.f. 1.7.2010, the term, immovable property also includes vacant land given on lease or licence for construction of building or temporary structure at a later stage to be used for furtherance of business or commerce. Thus, giving vacant land to a person on lease or licence basis is taxable only when in terms of the conditions of a lease or licence, the land is used for construction of a building or a temporary structure, which is used for furtherance of a business or commerce. The question now arises as to what is the use for furtherance of business or commerce. We find that Explanation 1 to Section 65(90a) defines the term for use in the course of or for furtherance of business or commerce as including the use of immovable property as the factories, office buildings, warehouses, theatres, exhibition halls and multiple use buildings. Thus, when the building constructed on a vacant land leased is purely as residential building, the same cannot be said to be a building to be used for furtherance of business or commerce. Therefore, the allotment of land to a builder or a group housing society for construction of residential complex would not be covered by Section 65(105)(zzzz) read with Section 65(90a) as in such cases, it cannot be said that the vacant land given on lease is for construction of building to be used for furtherance of business or commerce. Therefore, the service tax demand on the lease rent in respect of the allotment of vacant land to builders or group housing societies for the construction of residential complex would not be taxable. For the same reason, wherever such allotments have been made to institutions for construction of their buildings, to be used for non-commercial purposes, the same would also not be taxable.

13. Another plea of the Appellant is that the rent received during period w.e.f. 01.07.2010 in respect of leases of vacant land for construction of buildings or temporary structures for commercial use during period prior to 01.07.2010 would not be taxable and in this regard, reliance is placed on Apex Court judgment in the case of Vazir Sultan Tobacco Co. Ltd. reported in 1997 (83) ELT 3 (SC). The Apex Court in this case has held that the goods manufactured prior to levy of duty but cleared thereafter would not be liable to excise duty. This judgment does not help the Appellant, as the levy of service tax is on the event of provision of a taxable service, not on the event of entering into agreement for provision of service. Moreover, unlike manufacture of goods and clearance of manufactured goods which are one-time events, the provision of service in pursuance of an agreement for the same, may after starting the provision of service, continue for some time for several days, several months or several years, depending on the terms of the agreement and in between, a service which at the time of initiating the provision of service was non taxable may become taxable. Since the taxing event for service tax is provision of service, not the event of entering into an agreement for provision of service, the service provided from the date on which the same became taxable, would attract service tax, irrespective of the fact that at the time of entering into an agreement for provision of service, the same was not taxable. Therefore, the rent from leases of vacant lands for commercial or industrial use received during the period w.e.f. 01.07.2010 would be taxable even if the leases had been given during the period prior to 01.07.2010.

14. Whether for demand of service tax extended period of 5 years from the relevant date under proviso to Section 73 (1) of Finance Act, 1994 would be invokable and whether penalty would be imposable on the Appellant under Section 76, 77 and 78 of the Finance Act, 1994.

14.1 In terms of Section 73(1) of Finance Act, 1994, where any tax has not been levied or short paid or erroneously refunded, the central excise officers may within one year from the relevant date, serve notice on the person chargeable with the service tax which has not been levied or paid or which has been short levied or short paid or the person to whom such tax has been erroneously refunded requiring him to show case as to why he should not pay the amount specified in the show cause notice. The term, relevant date is defined in sub-section (6) of the Section 73. With effect from 28.05.2012, the normal limitation period has been enhanced to 18 months. In terms of proviso to Section 73(1) wherever service tax has not been levied or paid or short levied or short paid or erroneously refunded by reason of fraud, any wilful suppression of facts, mis-statement or contravention of any provisions of Chapter V of Finance Act, 1994 or of the Rules made thereunder with intent to evade payment of tax, the notice for recovery of such short levied, short paid or erroneously refunded service tax can be made within 5 years from the relevant date. Thus, longer limitation period of 5 years is applicable only when there is an element of fraud, collusion, wilful mis-statement, suppression of facts or deliberate contravention of the tax provisions with intent to evade payment of tax. The provisions of Section 73(1) of Finance Act, 1994 are in pari material with the provisions of the provision to Section 11 A(1) of Central Excise Act, 1994. The Apex Court in a series of judgments in the cases of CCE Vs. Chemphar Drugs & Liniments reported in 1989 (40) ELT 276 (SC), Pushpam Pharmaceuticals Company vs. CCE, Bombay (SC) reported in 1995 (78) ELT 401 (SC) Wallace Flour Mills in Cuttack reported in 1989 (41) ELT 198 (SC) has held that the extended period of five years for recovery of short paid, short levied or erroneously refunded duty under proviso to Section 11 A(1) of Finance Act, 1994 would not be applicable for failure or negligence of the manufacturer to take out licence or to pay duty when there was scope for doubt that the goods were dutiable or not, that the extended period under proviso to Section 11 A(1) is applicable only when there is something positive other than mere inaction or failure on the part of the manufacturer or producer or conscious or deliberate withholding of information when the manufacturer knew otherwise, or contravention of the provision of Central Excise Act, 1944 or of the Rules made thereunder with intent to evade payment of duty. It has also been observed that expression suppression of facts in proviso to Section 11 A(1) is to be interpreted strictly because it has been used in the company of such strong words as fraud, collusion, wilful mis-statement, and where the facts are known to both the parties. It is not the case of suppression of facts. The Apex Court in the case of Continental Foundation Joint Venture vs. CCE, Chandigarh reported in 2007 (216) ELT 0177 (SC) has held that wherever on account of conflicting judgments on an issue or conflictions circular of the Board on an issue, there is scope for doubt, the extended period under proviso to Section 11 A(1) of Central Excise Act, 1944 would not be applicable. In our view, the ratio of the above judgments of the Apex Court would be applicable while interpreting the provisions of Section 73(1) of the Finance Act, 1994. In this case, the appellant is a body corporate of the Government of Uttar Pradesh for performing statutory functions in accordance with the provisions of U.P. Industrial Area Development Act, 1976 and one of its functions is the allotment of vacant land to various persons for industrial or residential purposes on long term lease basis. In our view, there is merit in the appellants plea that they were under bonafide belief that the allotment of vacant land to various persons on long term lease basis for construction of building for industrial purposes, would not attract service tax under Section 65(105)(zzzz).Therefore, in the circumstances of the case, in our view, longer limitation period of 5 years from the relevant date would not be applicable and the service tax demand would survive only for the normal period of one year from the relevant date, which would be quantified by the adjudicating authority. For the same reasons, this is also a fit case, where by invoking the Section 80 of the Finance Act, 1994, penalties under Sections 76, 77 and 78 have to be waived and in terms of this section notwithstanding anything contained in the provisions of Section 76, 77 and 78 of the Finance Act, no penalty shall be imposable on the assessee for any failure, referred to in the said provisions, if the assessee proves that there was reasonable cause for the said failure and in this case, the Appellant is an organization functioning under the Government of U.P. and obvious reason for non-payment of service tax is their bonafide belief that allotment of vacant land on long term basis for construction of structure/ building for commend use would not attract service tax.

15. One of the pleas of the appellant is that there is overlapping of duty demand between the show cause notice dated 22.3.2012 issued by the ADG, DGCEI, demanding service tax of Rs.4,13,45,830/- for the period 1.7.2010 to 31.10.2011 and the show cause notice dated 17.10.2012 issued by the Commissioner Central Excise and Service, Tax, Noida, demanding service tax of Rs.140,74,64,321/- for the period May, 2007 to March, 2012. Though the order dated 30.04.2013 passed by the Commissioner in respect of a show cause notice dated 17.10.2012, at one place mention that the service tax demand of Rs.140,74,64,321/- confirmed by this order, does not include the service tax of Rs.4,13,45,830/- demanded in the show cause notice dated 22.3.2012 issued by a ADG, DGCEI and adjudicated by the order-in-original dated 16.07.2012, from the order dated 30.04.2013, it is not at all clear as to whether the service tax demand confirmed vide order-in-original dated 16.07.2012 is not covered by this order. In this regard, Shri Amresh Jain, ld. DR, in his written submissions has also mentioned that though efforts at every level from the Range Superintendent to the Commissioner were made with the notice to cooperate and submit the head wise figures but all vain and without notices cooperation, it could not be ascertained at that stage as to whether the amounts included in the show cause notice dated 22.3.2012 issued by the ADG, DGCEI, New Delhi is included in the show cause notice dated 17.10.2012. This written submission also mentions that on the basis of the data provided, it is not ascertainable as to whether the amount involved in the show cause notice dated 22.3.2012 has been excluded in the amount demanded in the show cause notice dated 17.10.2012. In view of this position, it would be appropriate to direct the Commissioner to examine this aspect also in the course of de novo proceedings and give a specific finding on this aspect.

16. In view of the above discussions, the following order is passed.

16.1 The service tax demand confirmed by the order-in-original dated 19.07.2012 is upheld only for the normal limitation period and the same is to be quantified by the Commissioner. The penalty on the Appellant under Section 77 and 78 is set aside.

16.2 As regards the order-in-original dated 30.04.2013, the same is set aside and the matter is remanded to the Commissioner for de-novo adjudication in terms of our directions in this order.

16.3 Both the appeals stand disposed of as above.