2017 (10) TMI 968 - AT - Service Tax

Levy of service tax - commercial coaching and training services - claim of appellant is that they did not have any profit motive, hence they are not liable to pay tax - Held that - we do not find any evidence that has been placed by the appellant that the value collected is without any profit. Besides, it is immaterial whether the service is rendered with profit motive or otherwise for levy of Service Tax - appeal dismissed - decided against appellant.

Summary

Issues:
- Appeal against Order-in-Appeal No. 193/2011 dated 9.5.2011 passed by the Commissioner, Central Excise (Appeals) regarding non-payment of service tax for 'commercial training or coaching service' provided from July 2003 to January 2006.

Analysis:
The case involved an appeal against an order confirming a demand for service tax along with interest and penalty for providing 'commercial training or coaching service' without registration or payment of service tax. The appellant, a cooperative society, argued that they did not aim to earn a profit from the services provided. The ld. Commissioner (Appeals) upheld the demand, stating that the motive for profit was irrelevant for levy of service tax. The Tribunal noted the absence of evidence proving that the services were provided without profit and emphasized that being registered as a cooperative society did not exempt them from paying service tax. Therefore, the Tribunal dismissed the appeal, affirming the order of the ld. Commissioner (Appeals).

This judgment highlights the importance of compliance with service tax obligations regardless of profit motive in providing taxable services. The Tribunal emphasized that the lack of evidence regarding profit motive does not exempt an entity from service tax liability. Additionally, being registered as a cooperative society does not automatically exempt an entity from service tax obligations. The decision underscores the need for entities to fulfill their tax obligations irrespective of their organizational structure or perceived profit motive in providing taxable services.