2024 (3) TMI 1104 - AT - Service Tax

Non-payment of service tax - commercial training and coaching center providing vocational training to the students - Department considered the services rendered by the appellant are taxable services and the exemption provided under N/N. 24/2004-ST dated 10.09.2004 is not applicable to them - HELD THAT - N/N. 24/2004-ST 10.09.2004 exempts vocational training provided by a Coaching Centre. The appellant considered the services rendered by them are exempted from payment of service tax as per this Notification. It is observed that there is no specific finding in the impugned order to the effect that the coaching offered by the appellant are not vocational training. A perusal of the Brochures submitted by the appellant clearly reveal that most of the courses offered by the appellant are vocational training. Accordingly the appellant are eligible for the benefit of Notification No. 24/2004-ST 10.09.2004. The legal status of respective universities is not in dispute. The syllabus for these courses are prescribed by the universities in consultation with the appellant institute and examinations are also conducted by the universities which thereafter issues certificate/degree/diploma to successful candidates. Therefore the appellant institute provided educational qualification recognized by the law and are accordingly outside the ambit of commercial training or coaching services. Hence there is no service tax liability on these services. The demand of service tax confirmed in the impugned order is not sustainable. Since the demand itself is not sustainable the question of demanding interest and imposing penalty does not arise. The impugned order set aside - appeal allowed.

Summary

Issues involved:
The issue in this case involves determining whether the appellant, a commercial training and coaching center providing vocational training in collaboration with universities, is liable to pay service tax for the courses offered.

Comprehensive Details of Judgment:

Issue 1: Applicability of Service Tax on Vocational Training Courses
The appellant contended that the courses provided by them are exempted from service tax u/s Notification No. 24/2004-ST. The Tribunal observed that most courses offered were vocational training as per the Brochures submitted. Therefore, the appellant was held eligible for the benefit of the said notification.

Issue 2: Collaboration with Universities and Recognition of Courses
The appellant argued that courses offered in collaboration with universities, where degrees/diplomas are awarded by the universities, are recognized by law and do not fall under commercial training services. The Tribunal noted that syllabus was prescribed by universities, exams conducted by them, and certificates issued by universities. Relying on a similar decision, the Tribunal held that demand for service tax was not sustainable.

Conclusion:
The Tribunal set aside the impugned order, allowing the appeal of the appellant. The demand for service tax was deemed unsustainable, thus no interest or penalty was imposed. The judgment was pronounced on 22.03.2024.