2015 (10) TMI 2003 - AT - Service Tax

Commercial training or coaching services - course of One Year Pre-Sea Training Graduate Engineers (GME) - Scope of exclusive clause of the Section 65(27) of Finance Act, 1994 - consulting engineering service received from abroad - reverse charge Held That - - Decision made in the cases of Indian Institute of Aircraft Engineering vs. UOI 2013 (5) TMI 592 - DELHI HIGH COURT and Indian National Shipowners Association vs. UOI 2008 (12) TMI 41 - BOMBAY HIGH COURT followed - Appellant is granted stay and recoveries stayed till the disposal of this case.

Summary

Issues:
1. Commercial training or coaching conducted by the appellant
2. Charging service tax for consulting engineering services received from abroad on reverse charge basis

Analysis:
Issue 1: Commercial training or coaching conducted by the appellant
The appellant claimed that their commercial training/coaching, leading to the award of a certificate of completing a course of One Year Pre-Sea Training Graduate Engineers (GME), is recognized by the Directorate of General Shipping, a Government of India authority. The appellant argued that this service falls under the exclusive clause of Section 65(27) of the Finance Act, 1994, and therefore, service tax cannot be charged on it. The appellant relied on the decision of the Hon'ble Delhi High Court in the case of Indian Institute of Aircraft Engineering vs. UOI to support their argument.

Issue 2: Charging service tax for consulting engineering services received from abroad on reverse charge basis
Regarding the charging of service tax for consulting engineering services received from abroad on a reverse charge basis, the appellant contended that these services were provided before the existence of Section 66A of the Finance Act, 1994 (prior to 18.4.2006). The appellant claimed that services received from abroad before this date cannot be subjected to service tax under the reverse charge mechanism. The appellant highlighted that service tax for these services provided after 18.4.2006 had already been paid. The appellant also referred to the decision of the Hon'ble Bombay High Court in the case of Indian National Shipowners Association vs. UOI to support their argument.

In light of the arguments presented and the legal precedents cited, the Tribunal granted a stay on the demand confirmed by the impugned Order-in-Original. The Tribunal also ordered that the recoveries be stayed until the final disposal of the case, considering the positions taken by the appellant and the relevant legal decisions referenced in support of their contentions.