Organising workships - Commercial training or Coaching Services OR Recreation Training category , Service Tax

[Vipul Baranwal]

Mr. X, a National Memory Record Holder, has been conducting Workshop wherein training is being imparted. His training includes some hobbies like: - Dictionary Learning, - Learning Long Digits, - Remembering Calendar, - Memorizing Shopping List - Memorizing Playing Cards - Telephone Numbers - Delivering Speech without Notes - Name & Faces - Appointments - Road Maps - Abbreviation etc. At International Level hobby Competition is organized every July in London since long back. Several quiz competition is also being organized on several TV Channels after Koun Banega Karorepati, e.g., Born Vita Quiz Contest, Kul Za Sim-Sim, Khel-Khel Main etc. By virtue of his training some of his students have also got success to place their name in Limca Book Records, e.g., Mahavir Jain for memorizing 80,000 words from oxford dictionary, Deepak Kumar for recalling of 7,050 digits in the value of pi. His students Ms Divyani, who memorized entire STD Codes of India and Arun who crammed entire Periodic Table have claimed to place their name in the Limca Book Of Records. Moreover, some students have also been selected to participate in International Level hobby Competition. Few students have also succeeded in TV Channels quiz Competition. A circular of service tax has exempted the recreational training such as hobbies, dance, music, martial arts etc from the service tax net. In opinion of Mr. X, the training would be classified as hobbies, etc. which falls under the Recreation Training category and therefore exempt from service tax. However, the service tax superintendent has issued a notice to the Mr. X that your service is covered well within the category of commercial training or Coaching Services. Whether the contention of the superintendent is tenable or not. Examine the issue and tender your opinion as per law, giving reasons.

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[Surender Gupta]

Notification No. 24/2004 ST dated 10-9-2004 permits exemption to a vocational training institute from whole of service tax. According to the notificatio the term "recreational training institute" means a commercial training or coaching centre which provides training or coaching relating to recreational activities such as dance, singing, martial arts or hobbies. Therefore, exemption is not to an activity but to an instituion who is a recreational training institute.