2018 (12) TMI 942 - AT - Service Tax

Penalty - computer training and coaching services providing by a computer training institute - N/N. 9/2003-Service Tax dated 20.06.2003 & 01/2004- Service Tax dated 04.02.2004 - Held that - The appellant requests that there was a confusion during the relevant time about the taxability of the services provided by them. These views have been held by various judicial pronouncements that where-ever there was confusion about the taxability of service, the imposition of penalty is not warranted - penalty set aside - appeal allowed in part.

Summary

Issues involved:
Interpretation of Notifications regarding service tax exemption for computer training institutes; Confusion regarding taxability of services provided; Imposition of penalty for confusion about taxability.

Analysis:

1. Interpretation of Notifications regarding service tax exemption for computer training institutes:
The case revolved around appeals filed against revision orders proposing a service tax demand under Section 73 of the Central Excise Act, 1944. The Commissioner revised the order of the Adjudicating Authority, emphasizing that the notifications issued by the Government exempted computer training and coaching services provided by computer training institutes from service tax for specific periods. Notifications such as No.9/2003-Service Tax dated 20.06.2003 and No.01/2004-Service Tax dated 04.02.2004 exempted these services till 30.06.2004. Subsequent amendments were made through Notification No.24/2004-ST dated 10th September, 2004 and Notification No.19/2005-ST dated 9th June, 2005. The Tribunal analyzed these notifications to determine the tax liability during the relevant periods.

2. Confusion regarding taxability of services provided:
The Revenue contended that the appellant was liable for service tax payment during the period in question, citing a Supreme Court decision Commissioner of Central Excise Vs. Sunwin Techno solution Pvt. Ltd. The appellant argued confusion existed during the relevant time regarding the taxability of the services they provided. The Tribunal acknowledged the confusion but ultimately ruled in favor of the Revenue, emphasizing that the Government excluded computer training institutes from the exemption intentionally through specific notifications. Despite the confusion, the Tribunal upheld the demand for service tax.

3. Imposition of penalty for confusion about taxability:
The appellant requested leniency due to the confusion surrounding the taxability of their services, citing judicial pronouncements that penalty imposition is unwarranted in such cases. After considering the submissions, the Tribunal set aside the penalties imposed on the appellants but upheld the order confirming the demand for service tax. The Tribunal concluded that the various notifications issued regarding the taxability of the service did not warrant the imposition of penalties, partially allowing both appeals.

In conclusion, the Tribunal's judgment clarified the interpretation of notifications regarding service tax exemption for computer training institutes, addressed the confusion surrounding the taxability of services provided, and decided on the imposition of penalties in such cases.