Parking Services Of Cycle, Scooters Doesn't Attract Service Tax: Punjab & Haryana High Court

The Punjab and Haryana High Court has held that the service tax is not payable on the parking services for cycles and scooters.

The single bench of Justice Vinod S. Bhardwaj has directed the department to release the security amount along with the interest within four weeks.

The petitioner/assessee had taken vacant land on lease at Bus Stand, Karnal, for parking of cycles/scooters during the period of April 10, 2011, to March 31, 2012, as well as for the 2012–2013 financial year.

The petitioner was directed to deposit an amount of Rs. 1,56,000 as refundable security along with the rental as agreed. The petitioner claims to have regularly deposited the due rent or charges levying under the Tender for the vacant land.

The petitioner was served a notice by the department that a service tax amount was required to be deposited by the petitioner. The petitioner responded to the notice by stating that, in terms of Section 65 (105) (zzzz) of the Finance Act of 1994, the service was not leviable upon the petitioner for the said parking services.

After the completion of the period of the contract, the petitioner approached the respondents to seek the release of the security amount; however, no heed was paid. The petition was filed because the respondents failed to refund the security deposit withheld for no valid reason.

As per the communication dated November 1, 2018, sent by the Assistant Commissioner of the Central Excise to the office of the Advocate General, pointing out that the service tax was not applicable to the cycle parking stand.

The department for service tax supported the claim of the petitioner.

The court held that the Department of Central Excise (as it was then), now the Assistant Commissioner of Central GST, clearly states that service tax is not applicable and no demand for service tax has ever been raised by the concerned department.

Case Title: Sham Lal Versus State of Haryana and others

Case No: CWP No. 19181-2014

Date: 29.10.2022

Counsel For Petitioner: Advocate Nonish Kumar

Counsel For Respondent: Addl. A.G. Vivek Chauhan

Citation: 2022 LiveLaw (PH) 285 

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