CBEC Clarification Circular on ‘Scope of Notification No. 25/ 2012 Service Tax dt. 20 June 2012’ reg. the term Precincts of Religious Place
The CBEC has noticed difficulties being faced in interpreting the scope of Notification No. 25/2012-Service Tax dated 20.06.2012 reg. the term Precincts of Religious Place and has issued clarification thereon.
The notification 25/2012 exempts services by way of renting of precincts of a religious place meant for general public. In the said Notification the terms ‘Religious Place’, `General Public’ and `Renting’ have been defined, however the term ‘precincts’ as appearing in the notification has not been defined and this gives rise to difficulty/ disputes in interpreting scope of the said exemption notification.
The CBEC has clarified that the term ‘precincts’ should extend to all immovable property of the religious place located within the outer boundary walls of the complex (of buildings and facilities) in which the religious place is located, as being located in the precincts of the religious place. The immovable property located in the immediate vicinity and surrounding of the religious place and owned by the religious place or under the same management as the religious place, may be considered as being located in the precincts of the religious place for extending the benefit of exemption under Notification No. 25/2012-Service Tax, SI. No. 5(a) dated 20.6.2012. To view/ download pdf copy of the CBEC Circular, please refer the link below:
Further, the CBEC has issued Notification No. 40/2016-Service Tax dt. 6 Sept. 2016 to restrict availability of the exemption to specific trusts only, i.e. service tax exemption shall be restricted only to renting of precincts of a religious place meant for general public, owned or managed by an entity registered as a charitable or religious trust under section 12AA of the Income-tax Act, 1961 or a trust or an institution registered under sub clause (v) of clause (23C) of section 10 of the Income-tax Act or a body or an authority covered under clause (23BBA) of section 10 of the Income-tax Act.