2026-VIL-515-CESTAT-CHE-ST
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SERVICE TAX CESTAT Cases

Service Tax - Eligibility of Cenvat Credit for "Renting of Immovable Property Service" (RIPS) despite change of ownership - The appellant had paid service tax under the 'Renting of Immovable Property Service' (RIPS). The appellant later sold the building thereby changing the ownership effective 18.06.2012. During the period 18.06.2012 to 30.06.2012, the appellant had collected the rent along with service tax from the tenant and paid the same to the new owner and availed Cenvat credit on the basis of the invoice raised by the new owner - Department denied the Cenvat credit on the ground that the appellant was not eligible for the same as the services had no nexus with their output services - Whether the appellant is eligible for the Cenvat credit on the "Renting of Immovable Property Service" (RIPS) despite the change of ownership – HELD – Though the transfer of ownership apparently brings an end to the ownership of the Appellant from the date of registration / handing over the possession, however, the same may be insufficient to conclusively contend that by virtue of sale there was no landlord-tenant relationship between the Appellant and occupant - The ownership is not a pre-requisite for providing RIPS. The activities undertaken by the appellant between 18.06.2012 and 30.06.2012 would fall under 'RIPS' notwithstanding the fact of transfer of ownership. The appellant continued to provide uninterrupted services to the tenant under the same commercial arrangement, and the denial of Cenvat credit would result in cascading of tax and perhaps lead to double taxation of the same services - The eligibility of the appellant to the Cenvat credit on the rent for 'RIPS' is in order. The impugned order is set aside and the appeal is allowed
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