Custom, Excise & Service Tax Tribunal
Sri Venkateswara Institute Of Medical ... vs Tirupati - Cgst Commissionerate on 14 October, 2025
1 Appeal No.ST/30917/2017
CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL
HYDERABAD
REGIONAL BENCH - COURT NO. - I
Service Tax Appeal No. 30917 of 2017
(Arising out of Order-in-Original No. TTD-EXCUS-000-COM-033-16-17 dated 31.03.2017
passed by Commissioner of Customs, Central Excise & Service Tax, Tirupati)
Sri Venkateswara Institute .. APPELLANT
of Medical Sciences
Tirupati,
Chittoor District,
Andhra Pradesh - 517 507.
VERSUS
Commissioner Of Central Tax .. RESPONDENT
Tirupati - GST 9/86, West Church Complex, Amaravathi Nagar, MR Palli Road, Tirupati, Andhra Pradesh - 517 502.
APPEARANCE:
Shri J.V. Rao, Advocate for the Appellant.
Shri K. Raji Reddy, Authorized Representative for the Respondent. CORAM: HON'BLE Mr. A.K. JYOTISHI, MEMBER (TECHNICAL) HON'BLE Mr. ANGAD PRASAD, MEMBER (JUDICIAL) FINAL ORDER No. A/30459/2025 Date of Hearing: 14.10.2025 Date of Decision: 14.10.2025 [ORDER PER: ANGAD PRASAD] M/s Sri Venkateswara Institute of Medical Sciences (hereinafter referred to as the appellant) are in appeal against OIO dt.31.03.2017, whereby, the Commissioner has confirmed the demand of Rs.47,30,538/- under the category of Commercial of Industrial Construction Service (CICS) during the years 2010-11 to 2011-12 along with interest and imposed equal penalty (impugned order).
2. The brief facts of the case are that the appellants are Super Specialty Hospital and a university providing medical care, educational and research facilities in the field of medical sciences including medical education and hospital administration. On credible information that the appellants had 2 Appeal No.ST/30917/2017 received certain amount from Sri Kanchi Peetam and Sri Venkateswara Institute of Medical Sciences Health, Medical Education and Research Foundation (service receivers/foundation) towards construction of medical college, the officers of Anti-Evasion Wing visited the premises of the appellant and enquired about the payments made by the foundation. Further, the Foundation vide letter dt.28.01.2014, inter alia, stated that they had purchased the 'unfinished structures' from the appellant along with exchange of 60 acres of land near kurukalva village by way of transfer deed dt.02.02.2012 and that they had paid an amount of Rs.12,93,12,000/- to the appellant towards the said purchase initially constructed by the appellant. Thereafter, when the foundation was contacted for payment of applicable service tax, the foundation vide letter dt.23.07.2015 stated that it is only a purchase and sale transaction regarding transfer of unfinished structures with land and there is no mention about the construction activity and hence service tax is not applicable. Accordingly, a SCN dt.21.10.2015 was issued to the appellants towards service tax payable on the Commercial or Industrial Construction service (CICS) along with interest and penalty. After adjudication, the Commissioner has passed the impugned order, against which the appellants have come in appeal before the Tribunal.
3. Learned Advocate for the appellant submitted that the Commissioner has failed to understand the basic nature, character and scope of services of transaction as it is relating to transfer of land along with semi-structures. The very fact of the transaction is that transfer/sale of immovable property which does not come under the ambit of service tax being a transfer of land along with its existing structures, which were permanently embedded to the land. Therefore, treating the said transaction as CICS is incorrect and it is not exigible to tax. He further submitted that the Commissioner has not considered their submissions and has passed the impugned order based on 3 Appeal No.ST/30917/2017 presumption without giving any proof or evidence. He further submitted that there is no agreement of service or construction and no activity carried out thereof. The transfer deed is pertaining to immovable property along with land existing small structures apparatus, embedded thereon. Accordingly, he has prayed that the impugned order may be set aside.
4. On the other hand, learned AR has reiterated the findings of the Commissioner.
5. Heard both sides and perused the records.
6. Copy of transfer deed is in appeal paper book in which it is mentioned that "this deed of transfer made and entered into on this day of 03.02.2012 at Tirupati between Sri Venkateswara Institute of Medical Sciences, a university established by an act of Andhra Pradesh State Legislature, herein after referred to as "SVIMS" and Sri Kanchi kamakoti Peeetam & Sri Venkateswara Institute of Medical Sciences Health, Medical Education and Research Foundation, a Trust registered under the Indian Trust Act 1882 jhaving its registered office at Sri Mahapaduka Mandapam, Ramakrishna Marg, Vinayaka Nagar, Tirupati-7, herein after referred to as "FOUNDATION". SVIMS and Foundation entered into a revised Memorandum of understanding on 11th August, 2010 signed by Sri N. Ramasarma, Trustee & Executive Secretary on behalf of the Foundation and Dr.V.S.R.Anjaneyulu, then Registrar on behalf of the SVIMS, Tirupati, mutually agreed by both the parties to exchange 60.00 acres of land from the respective position for establishing Sri Padmavathi Medical College and Research Centre & Sri Jayendra Saraswathi Swamigal Amrutha Mahotsava Multi Specialty Hospital at Kurakalva Village, Renigunta Mandal, Chittoor district, Andhra Pradesh as per the G.O. issued by the Government of Andhra Pradesh vide G.O.Ms.No.116 Revenue (assn. IV) dept. dated 14.02.2011 and subsequent 4 Appeal No.ST/30917/2017 proceedings issued by the District Collector, Chittoor vide Roo.No.E1/6667/2005, dated 14.02.2011, this mutual transfer of land as specified has been permitted and approved". It clears from transfer deed that foundation with land has been transferred.
7. The term 'service' has been defined in Section 65B(44) of the Finance Act, 1994 as follows:
"(44) "Service" means any activity carried out by a person for another for consideration, and includes a declared service, but shall not include--
(a) An activity which constitutes merely,--
(i) A transfer of title in goods or immovable property, by way of sale, gift or in any other manner; or
(ii) Such transfer, delivery or supply of any goods which is deemed to be a sale within the meaning of clause (29A) of article 366 of the Constitution; or
(iii) A transaction in money or actionable claim;
(b) A provision of service by an employee to the employer in the course of or in relation to his employment;
(c) Fees taken in any Court or tribunal established under any law for the time being in force.
Explanation 1:For the removal of doubts, it is hereby declared that nothing contained in this clause shall apply to,--
(A) The functions performed by the Members of Parliament, Members of State Legislative, Members of Panchayats, Members of Municipalities and Members of other local authorities who receive any consideration in performing the functions of that office as such member; or (B) The duties performed by any person who holds any post in pursuance of the provisions of the Constitution in that capacity; or (C) The duties performed by any person as a Chairperson or a Member or a Director in a body established by the Central Government or State Governments or local authority and who is not deemed as an employee before the commencement of this section. Explanation 2: For the purpose of this clause, the expression "transaction in money or actionable claim"
shall not include
(i) any activity relating to use of money or its conversion by cash or by any other mode, from one form, currency or denomination, to another form, currency or denomination for which a separate consideration is charged;
(ii) any activity carried out, for a consideration, in relation to, or for facilitation of, a transaction in money or actionable claim, including the activity carried out
(a) by a lottery distributor or selling agent on behalf of the State Government, in relation to promotion, marketing, organising, selling of lottery or facilitating in organising lottery of any king, in any other manner, in accordance with the provisions of the Lotteries (Regulation) Act, 1998;
(b) by a foreman of chit fund for conducting or organising a chit in any manner Explanation 3: For the purposes of this Chapter,-- 5 Appeal No.ST/30917/2017
(a) An unincorporated association or a body of persons, as the case may be, and a member thereof shall be treated as distinct persons;
(b) An establishment of a person in the taxable territory and any of his other establishment in a non-
taxable territory shall be treated as establishments of distinct persons. Explanation 4:A person carrying on a business through a branch or agency or representational office in any territory shall be treated as having an establishment in that territory;"
8. Therefore, merely transfer of land along with foundation structure; it is beyond scope of taxable service. Activity involving mere transfer of title in case which 'immovable property' by way of sale or gift or in any other manner is excluded from the meaning of service.
9. Section 3(26) of General Clauses Act, 1897 is defined 'immovable property' as follows:
(a) 'immovable property' shall include land, benefits to arise out of land, and things attached to the earth, or permanently, fastened to anything attached to the earth.
(b) Section 3 of the Transfer of Property Act, however, gives the following meaning to the expression "attached to the earth":
(i) Embedded in the earth, as in the case of walls and buildings;
(ii) Attached to what is so embedded for the permanent beneficial enjoyment of that to which it is attached.
(iii) With embedding in earth of the plant as in the case of walls and buildings, for the obvious reason that a building embedded in the earth is permanent and cannot be detached without demolition.
(iv) Sale of immovable property defined under the Transfer of Property Act 1882, as amended up to date, Section 54 days Transfer of Ownership in exchange for a price paid or promised or part paid.
10. Appellant is registered under Section 12AA of the Income Tax Act, 1961 for the purposes of activities.
6 Appeal No.ST/30917/2017
11. Since, the entire transaction is relating to as a whole transfer of immovable property along with semi constructed, old existing structures, and thereby, it will not fall under the provisions of Service Tax not eligible to tax, therefore, imposition of penalty and its question of penalty does not arise. In view of the above we do not find any merit in the impugned order. Therefore, impugned order is not sustainable, therefore appeal is liable to be allowed.
12. Appeal is allowed.
(Operative part of the order was pronounced in the Open Court) (A.K. JYOTISHI) MEMBER (TECHNICAL) (ANGAD PRASAD) MEMBER (JUDICIAL) Veda