2007 (3) TMI 130 - AT - Service Tax

Stay/Dispensation of pre-deposit - Revenue contented that appellants covered under Commercial Coaching Centre and liable for service tax - Held that revenue contention not sustained and pre-deposit waived and recovery stayed

Summary

Issues:
- Waiver of pre-deposit of Service tax + Education Cess
- Applicability of Service tax on deemed universities and entities registered under Societies Registration Act
- Commercial coaching services involvement and exemption for universities
- Comparison with previous rulings and orders

Analysis:
The appellants sought waiver of pre-deposit of substantial amounts of Service tax and Education Cess, along with equal penalties. The issue revolved around the applicability of Service tax on two appellants considered as deemed universities and two others registered under the Societies Registration Act. The Revenue contended that the appellants were engaged in commercial coaching services, thus liable for the tax. However, the appellants argued that the fees collected were utilized for educational purposes, exempting them from commercial coaching services.

In a similar matter involving M/s. Administrative Staff College of India, the Bench had granted waiver of pre-deposit and stayed recovery. The appellants highlighted the dropping of proceedings by the Joint Commissioner in their own case, emphasizing that the Revenue had not appealed against the decision. The Revenue opposed the waiver, asserting commercial involvement in coaching classes due to significant fee collection, challenging the applicability of exemptions.

Upon careful consideration, the Tribunal noted the Joint Commissioner's ruling that the appellants were not engaged in commercial coaching services subject to service tax. Drawing parallels with the M/s. Administrative Staff College of India case, the Tribunal granted waiver of pre-deposit and stayed recovery pending appeal disposal. The appeals were to be linked with the mentioned case for a final hearing, requiring the Commissioner to provide detailed comments.

The judgment highlighted the importance of specific rulings and exemptions in determining the applicability of Service tax, emphasizing the need for a comprehensive assessment of activities to ascertain tax liability.