Tenants’ SVLDRS Payment Satisfies 75% Pre-Deposit Requirement for Service Tax on Rental Income: CESTAT Remands Appeal

The CESTAT held that tenants' payments made under the Sabka Vishwas (Legacy Dispute Resolution) Scheme (SVLDRS) satisfy the 75% pre-deposit requirement under Section 35F of the Finance Act for pursuing appeals. The case involved a dispute over service tax on rental income, where the department had challenged the sufficiency of pre-deposit made by the tenants. The Tribunal clarified that since the SVLDRS payments effectively settle a part of the tax liability, they should be treated as valid toward the pre-deposit requirement. Consequently, the appeal was remanded for fresh consideration on merits. The ruling offers relief to landlords and tenants entangled in tax disputes involving the legacy service tax regime.