2009 (8) TMI 73 - AT - Service Tax

Commercial training or coaching profit motive Held that -. Commissioner of Central Excise (Appeals) has held that the activity of conducting training programmes on various subjects for government organizations, non-government organizations, bodies, corporate and members of the public on payment of prescribed fees does not fall under the taxable service of commercial training or coaching as to attract service tax liability, as it was not on the basis of profit motive Held that - There is no dispute that in the present case the respondents were a non-profit organisation registered under provisions of Section 25 of the Companies Act, 1956 which provision is applicable to non-profit organizations order of the commissioner (appeals) upheld.

Summary

Issues:
1. Maintainability of the appeal before the Tribunal based on the direction given by the Commissioner of Central Excise.
2. Whether the activity of conducting training programs by a non-profit organization falls under taxable service for service tax liability.

Analysis:
1. The Tribunal considered the preliminary objection raised by the assessees regarding the maintainability of the appeal before the Tribunal. The objection was based on the fact that the direction for filing the appeal was given by the Commissioner of Central Excise, which was not in line with the required procedure. The Tribunal noted that as of a certain date, only a Committee of Commissioners could direct any Central Excise Officer to appeal on its behalf to the Appellate Tribunal. The Tribunal also referred to various decisions, including those in the cases of Institute of Banking Personnel Selection and Dr. Jivaraj Mehta Smarak Health Foundation and Medical Centre, to support its conclusion on this issue.

2. The main issue in the case was whether the activity of conducting training programs by the respondents, a non-profit organization registered under the Companies Act, 1956, fell under the taxable service category for service tax liability. The Commissioner of Central Excise (Appeals) had held that the training programs conducted by the organization did not attract service tax liability as they were not driven by a profit motive. The Tribunal upheld this decision, noting that the organization was registered as a non-profit entity under Section 25 of the Companies Act, which is applicable to non-profit organizations. The Tribunal referred to precedents like the case of Great Lakes Institute of Management Ltd. to support its conclusion that the training programs conducted by the organization did not constitute taxable services.

In conclusion, the Tribunal upheld the decision of the Commissioner of Central Excise (Appeals) that the activity of conducting training programs by the non-profit organization did not fall under the taxable service category for service tax liability. The appeal of the Revenue was rejected, and the cross objection was dismissed as it was only in the nature of comments on the Revenue's appeal.