2018 (1) TMI 1020 - AT - Service Tax

Commercial training or coaching centre Services - exemption under N/N. 24/2004-ST - appellant /assessee were conducting courses in International Hotel Management in collaboration with the Thames Valley University, UK - whole demand proceedings resulting in the two impugned orders cover two periods viz. prior and post 2008 - Held that - for the period prior to 2008, the courses conducted by the appellant in collaboration with the Thames Valley University, UK in international hotel management is covered by exemption N/N. 24/2004. No service tax liability can be fastened on the appellant for this period. Post 2008, the appellants discontinued the course in collaboration with the Thames Valley University, UK. They have started a 3 year course of BA (Hons) in International Hospitality Administration approved by IGNOU, leading to an award of degree by IGNOU, which is, admittedly, a recognized open university under UGC Act - for the period, during which the appellants were conducting courses results in the award of degree by a recognized university, they are not covered by the scope of Commercial Training or Coaching Centre . Demand set aside - appeal allowed - decided in favor of appellant.

Summary

Issues:
1. Tax liability under commercial training or coaching center category.
2. Interpretation of exemption notification no. 24/2004 for vocational training.
3. Recognition of degree awarded by foreign university.
4. Tax liability for courses leading to degree by recognized university.

Analysis:

1. The case involved appeals by the assessee against the orders of the Commissioner of Central Excise regarding tax liability under the category of commercial training or coaching center. The Revenue also filed an appeal against dropping of demand for an extended period. The dispute revolved around the nature of courses conducted by the educational Trust and the tax implications thereof.

2. The Revenue contended that the courses conducted by the appellant fell under the commercial training category, leading to service tax liability. However, the appellant claimed exemption under notification no. 24/2004 for vocational training. The Tribunal analyzed the scope of the exemption and the definition of vocational training institute, emphasizing the need for imparting skills for seeking employment or self-employment directly after training.

3. The Tribunal scrutinized the recognition of the degree awarded by the foreign university, Thames Valley University, and its relevance to the classification of the courses as vocational. The Original Authority's interpretation was challenged, highlighting the importance of the degree leading to employment opportunities in the specified field.

4. Post-2008, the appellant shifted to conducting courses in collaboration with IGNOU, a recognized open university. The Tribunal examined the tax liability for courses leading to a degree awarded by a recognized university, such as IGNOU. The definition of "Commercial Training or Coaching Centre" under Section 65(27) was analyzed in light of the degree awarded by IGNOU, leading to the exclusion of tax liability.

In conclusion, the Tribunal held that the courses conducted by the appellant were covered by the exemption notification no. 24/2004 for vocational training. The tax liability for the period post-2008, when courses led to a degree by a recognized university, was also dismissed. The impugned orders confirming service tax liability were set aside, and the appeals by the assessee were allowed.