2013 (12) TMI 1322 - AT - Service Tax

Waiver of pre deposit - Commercial Training and Coaching Service - Exemption under Notification No. 24/2004-S.T., dated 10-9-2004 - Held that - prima facie case for the appellant against the demand raised under the head commercial training and coaching service . There is substance in the submission of the learned counsel that, prior to 1-5-2011, the date with effect from which the definition of commercial training and coaching centre was amended, appellant was not liable to pay service tax on the amounts collected by them from trainees and students attending short term courses - appellant was working as a vocational training institute during the material period. They got affiliated with the National Council for Vocational Training in 2009. Therefore, the claim of exemption is also prima facie sustainable. Insofar as the demand under the head consulting engineer service is concerned, the submission is that they were rendering advisory assistance to industries on the directions of the State Government and were receiving financial aid from the Government. The services were rendered to both PSU and other industries. No remuneration was collected from those industries - Following decision of Central Power Research Institute v. Commissioner of Central Excise, Bangalore-II 2006 (5) TMI 26 - CESTAT, BANGALORE - Stay granted.

Summary

Issues:
1. Waiver and stay of service tax and education cess demanded for the period from April 2004 to January 2009.
2. Demand under "Commercial Training and Coaching Service" and "Consulting Engineer Service" with associated penalties.
3. Prima facie case for waiver under "Commercial Training and Coaching Service" and exemption under Notification No. 24/2004-S.T.
4. Claim of exemption for being a vocational training institute affiliated with the National Council for Vocational Training.
5. Submission regarding rendering advisory assistance to industries on the directions of the State Government and receiving financial aid.

Analysis:

1. The application sought waiver and stay of a substantial amount demanded for service tax and education cess for a specific period. The demand was categorized under two heads: "Commercial Training and Coaching Service" and "Consulting Engineer Service," with penalties imposed. The Tribunal reviewed the records and arguments from both sides to assess the case.

2. Concerning the demand under "Commercial Training and Coaching Service," the Tribunal acknowledged a prima facie case for the appellant. It was noted that prior to a specific amendment date, the appellant was not liable to pay service tax on amounts collected from trainees. Additionally, the appellant could potentially claim exemption under a relevant notification due to its status as a vocational training institute affiliated with the National Council for Vocational Training.

3. In relation to the demand under "Consulting Engineer Service," the appellant's submission highlighted that they provided advisory assistance to industries under governmental direction and received financial aid without collecting remuneration. Citing relevant circulars and precedents, the appellant argued that being a public-funded research institute receiving grants, they should not fall under the service tax ambit.

4. Following thorough consideration of the submissions, the Tribunal granted the application, resulting in a waiver of pre-deposit and a stay of recovery for the dues adjudged against the appellant. The decision was pronounced in an open court session.

This detailed analysis captures the key aspects of the judgment, including the issues raised, arguments presented, and the ultimate decision rendered by the Tribunal.