DO WE HAVE TO PAY SERVICE TAX ON RENTAL OF PROPERTY?

we are a deemed limited company We have purchased a flat in Hebbal and have furnished it with furniture, fixtures and fittings. We have given it on a rent for a another limited company for 11 months agreement. We get a rental income of Rs 35000 per month. do we have to pay service tax on rental
of fully furnished flat to the government. We have not registered with service tax. Please clarify.

How is rental income taxed in India?

My parents (who live in Mumbai right now) plan to relocate to a place outside Maharashtra. They plan to give their Mumbai residence on rent and live in a rented house as their new residence in the new place? They are both senior citens. Would they be required to pay tax on their rental income they earn in Mumbai?

Are they going to arrest people producing false rental receipts this year?

The new income tax Circular No– 05/2011 requires one to produce the PAN card of the landlord if the rent paid for the year exceeds Rs.180000. If the landlord doesn’t have a PAN card one should get a written declaration from him that his income is below the taxable income.
Will they be conducting checks? It seems they have implemented this rule due to the increase in the number of people producing false rental receipts. Naturally, I’m one of them and so I’m afraid.