2017 (11) TMI 1774 - AT - Service Tax

Business Auxiliary Services - appellant providing service on behalf of the principal - liability of service tax - Held that - There is nothing on record that this service facilities, sale of C.Ds provided by the eBIZ is an educational service. As per brochure education material, it is clearly mentioned that eBIZ is providing education material. When it is so, it can be concluded that the appellants are providing business auxiliary services and service tax, if any, can be charged from the principal - appeal allowed - decided in favor of appellant.

Summary

Issues:
Service tax liability on sale of educational C.Ds by appellants under Business Auxiliary Services exemption Notification No. 14/2004-S.T.

Analysis:
The judgment by the Appellate Tribunal CESTAT Kolkata involved an appeal against the demand of service tax on the sale of educational C.Ds by the appellants. The Order-in-Appeal had demanded service tax amounts of &8377; 24,264/- and &8377; 2,68,813/-, including education cess. The appellants contended that the company, eBIZ, was liable to pay the service tax, not them, as they were promoting the sale of educational C.Ds. The appellants argued that they fell under exempted services as per Notification No. 14/2004-S.T., dated 10-9-2004, related to Business Auxiliary Services provided by commercial concerns. The appellants claimed they were providing services on behalf of the principal and should be exempted from service tax.

During the hearing, the appellants' counsel highlighted that eBIZ was engaged in online educational services and sold educational C.Ds. The Revenue's representative justified the impugned order and argued that the appellants did not qualify for the exemption under Notification No. 14/2004-S.T. The Tribunal examined the impugned order and noted that the educational material provided by eBIZ clearly indicated it was engaged in education services. Consequently, the Tribunal concluded that the appellants were providing business auxiliary services, and any service tax should be charged from the principal. As a result, the Tribunal set aside the impugned orders and allowed the appeals, ruling in favor of the appellants.

In conclusion, the judgment clarified the service tax liability concerning the sale of educational C.Ds by the appellants under the Business Auxiliary Services exemption Notification No. 14/2004-S.T. The Tribunal determined that the appellants were promoting the sale of educational material on behalf of eBIZ, which was engaged in providing education services. Therefore, the appellants were providing business auxiliary services, and any applicable service tax should be charged from the principal, leading to the decision in favor of the appellants.