2022 (9) TMI 852 - AT - Service Tax

Levy of Service tax - Mailing list compilation and Mailing services - educational institution or not - HELD THAT - The appellants are a premier institution and are engaged in providing education in the field of management and business. For the purpose of admission into the IIMs, IIM Ahmedabad conducted the CAT (common admission test) of candidates in the year 2009. A large number of candidates took the exam and some candidates were selected by IIMs for the purpose of admission to IIM. A larger number of candidates who took the CAT exam also applied to various other institutes and those institutes sought to use the CAT s scores for the purpose of admission into their schools. To access the CAT scores for themselves, the said Non-IIM Institutes entered into a Memorandum of Understanding with IIM Ahmedabad, the appellant. It is seen that the appellants are not compiling any list or providing list of names addresses etc. The appellants are merely providing scores in respect of names of candidates supplied by the clients (Non-IIM Institutes). Moreover, the activity of Mailing list compilation and mailing is done for or on behalf of the client. There are no reason to hold that the activity done by the appellant is covered under the head of Mailing list compilation and Mailing service - appeal allowed.

Summary

Issues:
Appeal against demand of service tax for "Mailing list compilation and Mailing services."

Analysis:
1. The appellant, an Indian Institute of Management (IIM), conducted the CAT exam for admission, with non-IIM institutes using CAT scores for evaluating applicants. Non-IIM institutes paid fees for accessing CAT scores as per Memorandum of Understanding (MoU) terms.

2. The MoU outlined the process of providing section-wise scores to non-IIM institutes for evaluating candidates. The primary purpose was to assess students' caliber for admission.

3. The appellant argued that the service provided did not fall under the definition of "mailing list compilation and mailing service" as per Section 65(105)(zzzg) of the Finance Act and CBEC Circular F. No. B1/6/2005-TRU dated 27.07.2005.

4. The Tribunal noted that the appellant's activity did not involve compiling lists or providing names and addresses but solely providing scores of candidates. The service of "mailing list compilation and mailing" is distinct from the appellant's activity, as per the Circular's definition.

5. The MoU between the appellant and non-IIM institutes clarified the nature of the service provided, which was not related to mailing list compilation. The Tribunal concluded that the appellant's activity did not fall under the taxable category of "Mailing list compilation and Mailing services," thus allowing the appeal.

The judgment emphasized the distinction between the appellant's service of providing CAT scores to non-IIM institutes and the taxable service of mailing list compilation and mailing. The detailed analysis of the MoU terms and legal definitions supported the conclusion that the appellant's activity did not meet the criteria for service tax under the specified category.