2014 (4) TMI 250 - AT - Service Tax

Waiver of pre-deposit of service tax - Commercial Training or Coaching Service - applicant had sold prospectus and admission forms for consideration and had not paid service tax on such consideration - Held that - sale of prospectus and admission forms cannot be considered as commercial training and coaching services. Prospectus are sold for consideration to many students who desire to take admission. Some of the students may not apply for admission though they have purchased the prospectus and those who applied for admission may not get admission due to limited number of seats. Therefore, consideration amount received by sale of prospectus and form cannot be considered as part of commercial training and coaching services - Matter remanded back - Stay granted.

Summary

Issues:
1. Waiver of pre-deposit of service tax, interest, and penalty.
2. Classification of sale of prospectus and admission forms as commercial training or coaching services.
3. Compliance with stay order conditions and dismissal of appeal by Commissioner (Appeals).
4. Consideration amount received by sale of prospectus and admission forms.

Analysis:

1. The applicant sought waiver of pre-deposit of service tax, interest, and penalty amounting to Rs.5,17,707. The Revenue alleged that the applicant, registered under the category of "Commercial Training or Coaching Service," had not paid service tax on the consideration received from the sale of prospectus and admission forms during the period 2006-2012.

2. The appellant contended that the sale of prospectus and admission forms should not be considered as commercial training or coaching services. They argued that the consideration received from selling prospectus and forms to students, some of whom may not apply for admission or may not secure admission due to limited seats, should not be categorized as part of the services provided.

3. The Commissioner (Appeals) had directed the appellant to deposit the service tax along with interest, which the appellant failed to comply with, leading to the dismissal of the appeal without delving into the merits of the case. The Tribunal noted the non-consideration of the matter on its merits by the Commissioner (Appeals) and set aside the impugned order, remanding the case back to the Commissioner (Appeals) for a decision after affording the appellant an opportunity of hearing.

4. The Tribunal found merit in the appellant's argument that the consideration received from the sale of prospectus and admission forms should not be considered as part of the services provided, leading to the waiver of pre-deposit of dues and a stay on recovery during the appeal's pendency. The appeal was allowed by way of remand, emphasizing the need for a thorough consideration of the case on its merits by the Commissioner (Appeals).

This comprehensive analysis of the judgment outlines the issues raised, the arguments presented, and the Tribunal's decision, providing a detailed overview of the legal proceedings and the reasoning behind the judgment.