2025 (3) TMI 333 - AT - Service Tax

Manpower Recruitment and Supply Agency Service - Commercial Training and Coaching Service - Providing first aid training to the students of the schools and colleges - extended period of limitation. Man Power Recruitment and Supplies Agency Service - HELD THAT - The appellant is admittedly a Welfare Voluntary Organisation created under the Indian Red Cross Society Act 1920 and the Deputy Commissioner (DC) of Chandigarh is the Chairman of the said society. It is also found that the appellant only provides temporarily the Man Power to registration and licesensing authority for the purpose of expedition of issuance of Driving Licences and Registration Certificates of Motor Vehicles in the RLA Office where there is an acute shortage of staff - the appellant is paid a fixed share out of the fees for issuance of Driving Licences/Registration Certificates of vehicles as a lump-sum amount on per case basis. Providing first aid training to the students of the schools and colleges - HELD THAT - The Government is not covered by the terms person . Further the definition of person was amended only in 2012 to include Government but the period involved in the present case is prior to 2012 therefore the service provided to the Government will not be covered in the term to any person and therefore will not be taxable. It is also found that the first aid training to the students is a part of their syllabus of health education for class 9th prescribed under CBSE and only a nominal fees is paid by the students. Extended period of limitation - HELD THAT - The suppression cannot be alleged against the appellant which is a non-profit making society working under the direct control of the Deputy Commissioner of Chandigarh and the adjudicating authority has also dropped the penalty under Section 80 by observing that extended period cannot be invoked; therefore once the extended period cannot be invoked the liability for the normal period. The impugned order is not sustainable in law - appeal allowed.

Summary

The present case involves an appeal against an order passed by the Commissioner (Appeals) rejecting the appellant's appeal. The appellant, a Welfare & Voluntary Organization created under the Indian Red Cross Society Act, 1920, was involved in providing manpower for clerical work related to the preparation of driving licenses and registration certificates of vehicles. The appellant also provided first aid training services to schools and colleges. The main issues considered in this case are whether the appellant's activities fall under the category of Manpower Recruitment and Supply Agency Service and Commercial Training and Coaching Service, and whether the demand for service tax imposed on the appellant is sustainable.**Issues Presented and Considered:**1. Whether the appellant's activities constitute Manpower Recruitment and Supply Agency Service.2. Whether the appellant's provision of first aid training falls under Commercial Training and Coaching Service.3. Whether the demand for service tax on the appellant is justified.4. Whether the limitation period for imposing penalties applies to the appellant.**Issue-Wise Detailed Analysis:****Manpower Recruitment and Supply Agency Service:**- The appellant argued that they were not a commercial concern and that the activities performed were statutory in nature.- The appellant contended that the payments received were not based on the number of persons deputed but on a fixed rate per item/job.- The Tribunal found that the appellant was a Welfare & Voluntary Organization and provided manpower to assist the Registering/Licensing Authority in their official duties.- The Tribunal concluded that the appellant did not fall under the definition of a commercial concern for the purpose of charging service tax under Manpower Recruitment and Supply Agency Service.**Commercial Training and Coaching Service:**- The appellant provided first aid training to students, which was part of their syllabus under the Health Education program.- The Tribunal noted that the service provided to the government was not taxable as the term "to any person" did not cover government entities during the relevant period.- The Tribunal found that the first aid training provided by the appellant did not fall under Commercial Coaching/Training Service.**Limitation Period and Penalties:**- The Tribunal held that suppression of facts with the intent to evade tax could not be alleged against the appellant, a non-profit-making society.- The Tribunal observed that the extended period could not be invoked, leading to the liability for the normal period being dropped.- The Tribunal referred to a previous case to support its decision on the limitation period and penalties.**Significant Holdings:**- The Tribunal set aside the impugned order, finding it unsustainable in law, and allowed the appeal of the appellant.In conclusion, the Tribunal ruled in favor of the appellant, determining that the demand for service tax was not justified, and the activities of the appellant did not fall under the categories of Manpower Recruitment and Supply Agency Service or Commercial Training and Coaching Service. The Tribunal also found that the limitation period for penalties did not apply to the appellant, ultimately allowing the appeal with consequential relief as per law.