University Income From Rentals, Not Exempted From Service Tax: Karnataka High Court

The Karnataka High Court ruled that income from renting out university properties is exempt from service tax. The court decided that such rental income is part of the university’s core educational activities and therefore qualifies for the exemption. This ruling emphasizes that the primary function of the university's property rental is to support its educational mission, rather than commercial activities that would typically be subject to service tax. The judgment reinforces that educational institutions can benefit from tax exemptions if the income generated is aligned with their educational objectives.