2018 (6) TMI 1489 - AT - Service Tax

Sale or service - Commercial Training or Coaching Service - liability of service tax on sale of study material to students who did not attend the classes - case of appellant is that no Service Tax is liable to be paid since no service of coaching has been rendered and the study material has simply been sold - Held that - Identical issue decided in the case of COMMISSIONER OF CENTRAL EXCISE & S.T., LUCKNOW VERSUS ANURAG MATHS CLASSES, ANIL CHEMISTRY CLASSES AND RAJESH PHYSICS CLASSES 2018 (4) TMI 114 - CESTAT ALLAHABAD , whee it was held that the benefit of Exemption N/N. 12/2003 dated 26/06/2003 will be available for the cost of study materials sold - appeal allowed - decided in favor of appellant.

Summary

Issues:
Service Tax liability on sale of study material to non-students by an educational institution.

Analysis:
The appellant, engaged in providing coaching/training services, faced a dispute regarding the Service Tax liability on the sale of study material to non-students. The appellant had paid Service Tax on the tuition fee, including the cost of study material, for registered students attending classes. However, for non-students purchasing study material only, the appellant did not pay Service Tax. The Department issued a show cause notice demanding Service Tax, leading to the confirmation of the demand in the Order-in-Original, which was upheld in the impugned order dated 25/07/2014.

During the proceedings, the appellant argued that they had already paid Service Tax on the tuition fee for registered students and that the dispute solely pertained to the sale of books to non-students, for whom no coaching service was provided. The appellant relied on several case laws where similar issues were decided in favor of the appellant, emphasizing that no Service Tax liability existed for the sale of study material to non-students.

The Department, represented by the Ld. DR, supported the impugned order upholding the Service Tax demand. However, the Tribunal, in its analysis, noted that the dispute centered around the sale of study material to non-students without any coaching service being provided. Referring to the case laws cited by the appellant, the Tribunal found that the benefit of Exemption Notification 12/2003 was applicable to the cost of study materials sold, aligning with the decisions in the previous cases.

Ultimately, the Tribunal found no justification for the impugned order and set it aside, allowing the appeal in favor of the appellant. The judgment highlighted the consistent interpretation of the law in similar cases and the applicability of the exemption for the sale of study materials in educational contexts.