2013 (12) TMI 735 - AT - Service Tax

Denial of refund claim - Exemption under Notification NO. 24/04-ST dated 10.9.2004 - Vocational Training or Commercial Training & Coaching - Post Graduate Diploma in Management (PGDM) at Sadhana Centre for Management & Leadership Development (SCMLD) - Held that - appellant is accepting that they are providing Commercial Coaching and Training Centre - the course is for a duration two years. The first year is common to all candidates. Thereafter they undergo summer training with some organization. In the second year, they undergo courses in one of the five disciplines/area of specialization - From the course content, it is clear that courses are academic in nature and covers broad spectrum of subjects - No doubt the two years course will help candidates in understanding various facets of management and get employment. It is a professional management course. This cannot be considered as Vocational Course that imparts skill to enable the trainee to seek employment or self employment after the said course. Notification No. 24/2004-ST dated 10.9.2004 has been amended vide notification No. 3/2010-ST dated 27.2.2010, wherein the Explanation relating to Vocational Training Institute is replaced by new definition. As per new definition, Vocational Training Institute means as Industrial Training Institute or Industrial Training Centre affiliated to the National Council for Vocational Training, offering courses in designated trades as notified under the apprentices Act, 1961 (52 of 1961). Though the said explanation was inserted in 2010, but indicates the scope of term vocational training in specific terms - Decided against assessee.

Summary

Issues Involved:
1. Whether the appellant's course qualifies as vocational training under Notification No. 24/2004-ST dated 10.9.2004.
2. Whether the appellant is entitled to a refund of the service tax paid.

Detailed Analysis:

1. Qualification as Vocational Training:
The appellant, M/s. Sadhana Educational & People Development Services Ltd., claimed exemption from service tax under Notification No. 24/2004-ST, arguing that their Post Graduate Diploma in Management (PGDM) course qualifies as vocational training. The notification exempts taxable services provided by a vocational training institute, defined as a center providing training that imparts skills enabling trainees to seek employment or self-employment directly after training.

The appellant argued that their course in Marketing, Finance, Human Resources Management, System Management, and Manufacturing and Operations Management qualifies as vocational training because it prepares students for employment or self-employment. They cited several case laws, including Ashu Export Promoters (P) Ltd. Vs. CST and Prof. Ulhas Vs. Bapat Vs. CCE, where vocational training was interpreted broadly to include various professional courses.

However, the Tribunal found that the course content of the appellant's PGDM program is broad, academic, and professional rather than vocational. The Tribunal emphasized that vocational training should impart specific skills directly applicable to employment or self-employment, which is not the case with a general MBA program. The Tribunal referenced the case of Prof. Ulhas V. Bapat, where it was held that vocational courses are typically for individuals with lower educational qualifications (8th, 10th, or 12th standard) and are more narrowly focused.

2. Entitlement to Service Tax Refund:
The appellant sought a refund of Rs. 8,56,522/- for the service tax paid, arguing that their course was exempt from service tax for the period other than 1.7.2004 to 9.9.2004. The original authority and the Commissioner (Appeals) rejected this claim, leading to the present appeal.

The Tribunal upheld the rejection, concluding that the appellant's course does not qualify as vocational training under the relevant notification. The Tribunal noted that while the course may help in securing employment, it does not fit the definition of vocational training as it is broad and academic rather than skill-specific.

Conclusion:
The Tribunal dismissed the appeal, holding that the appellant's PGDM course does not qualify as vocational training under Notification No. 24/2004-ST dated 10.9.2004. Consequently, the appellant is not entitled to the claimed refund of the service tax paid. The decision was pronounced in court on 23/10/2013.