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2020 (1) TMI 943 - AT - Service TaxDemand of service tax - fees charged from students for the Post Graduate Diploma in Liberal Studies - course conducted by the University - whether covered under the scope of the expression education as a part of curriculum for obtaining a qualification recognized by any law for the time being in force or not? - benefit of exemption from service tax in terms of Sr.No.9(a) of Notification No.25/12-ST dt.20.6.2012 or not - extended period of limitation - penalty. HELD THAT - The private university shall commence enrolment of students for such course or programme of study and shall give authorization to the university to start the course or programme. The private university shall not commence first enrolment of student without specific authorization of the Government. In no case, the application for authorization be kept beyond 120 days, whereafter it shall be deemed to have the concurrence of the Government to start the course or programme of study. The appellant in compliance to the said provisions has obtained authorization from the State Government on 14.7.2014 - the appellant is running the course, namely, Post Graduate in Liberal Studies is a course authorised by the Government of Haryana which is the regulatory body of the appellant. Admittedly, section 22 (3) of the UGC Act clearly states that UGC is not having power to specify the list of diploma, as admitted by the Ld.AR in his written submission. Further, in answer to frequently asked question, it has been clarified by UGC that Diploma/certificate courses are not specified by UGC. However, universities can run the diploma / certificate courses and with due approval of its governing councils/statutory council wherever required . Admittedly, in this case, the appellant has got necessary approval to run the said course. Therefore, the allegation made in the show cause notice is not sustainable as the appellant is not running the course which are not recognised by any law. Thus, the appellant is running course, namely, Post Graduate Diploma in Liberal Studies is recognized by the State of Haryana which the regulatory body is authorizing the appellant to run the course and as per the report of expert of committee of UGC approved intake 200 whereas 197 is the current intake. Therefore, the appellant is entitled for the benefit of exemption Notification No.25/12-ST dt.20.6.2012.
Issues Involved:
1. Whether service tax can be demanded from the appellant on the fees charged from students for the "Post Graduate Diploma in Liberal Studies" or not. 2. Whether the "Post Graduate Diploma in Liberal Studies" course conducted by the University is covered under the scope of the expression "education as a part of curriculum for obtaining a qualification recognized by any law for the time being in force" or not. 3. Whether the appellant is entitled to the benefit of exemption from service tax in terms of Sr.No.9(a) of Notification No.25/12-ST dated 20.6.2012 or not. 4. Whether the extended period can be invoked to demand service tax and whether the imposition of penalty can be sustained under section 78 of the Finance Act, 1994, in the facts and circumstances of the case or not. Issue-wise Detailed Analysis: 1. Demand of Service Tax on Fees Charged for the Course: The Tribunal examined whether service tax could be demanded from the appellant on the fees charged for the "Post Graduate Diploma in Liberal Studies" course. It was established that the appellant is a private university recognized under the Haryana Private Universities Act, 2006. The course in question is authorized by the Government of Haryana, as evidenced by Memo No. KW 20/14-2011 UNP (5) dated 14.07.2014. The Tribunal concluded that the appellant is running a course recognized by law, thus, service tax cannot be demanded. 2. Recognition of the Course Under the Law: The Tribunal considered whether the "Post Graduate Diploma in Liberal Studies" falls under the expression "education as a part of curriculum for obtaining a qualification recognized by any law for the time being in force." The Tribunal noted that the appellant had complied with the Haryana Private Universities Act, 2006 and obtained necessary authorizations from the Government of Haryana. Furthermore, the UGC Expert Committee had acknowledged the course, and there were no objections to its conduct. Thus, the course was deemed to be recognized by law. 3. Entitlement to Exemption from Service Tax: The Tribunal evaluated whether the appellant could avail the benefit of exemption from service tax under Sr.No.9(a) of Notification No.25/12-ST dated 20.6.2012. Given that the course was recognized by the Government of Haryana, the Tribunal concluded that the appellant was entitled to the exemption. The Tribunal also referenced UGC clarifications that diploma/certificate courses do not require UGC approval, further supporting the appellant's claim for exemption. 4. Invocation of Extended Period and Imposition of Penalty: The Tribunal assessed whether the extended period for demanding service tax and the imposition of penalties under section 78 of the Finance Act, 1994, were justified. It was found that all relevant facts were within the knowledge of the department, and the case was based on records submitted by the appellant. Consequently, the Tribunal held that the extended period could not be invoked, and penalties could not be imposed. Conclusion: The Tribunal set aside the impugned order and allowed the appeal, granting the appellant consequential relief. The appellant was entitled to the benefit of exemption Notification No.25/12-ST dated 20.6.2012, and no service tax or penalties were payable.
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