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TMI Blog2013 (8) TMI 336X X X X Extracts X X X X X X X X Extracts X X X X ..... their centres across the country, out of which except for eight centres, which are wholly owned by CLIL, the rest are operated through three parties under franchise agreements. The appellant in this case have entered into a license agreement/franchise agreement with CLIL in 2001, which is reviewed after 3 years. Under this agreement, the appellant Operates the commercial training and coaching centres of CLIL using its trade mark, logo and the proprietary system developed by CLIL. The fee collected from the students is deposited by the appellant in the account of CLIL and the receipt is also issued by CLIL. The CLIL retained 75% of the fee and gave 25% to the appellant for operating the coaching and commercial training centres. There is no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sides in respect of stay application. 3. Shri B.L. Narsimahan, ld. Advocate for the appellant pleaded that the appellant had entered into a franchise agreement with CLIL and using the brand name of CLIL and methodology adopted by CLIL, were operating the commercial and training centres of CLIL, that the appellant were collecting the fee for the various courses on behalf of the CLIL and were deposing the same in CLIL's account, that the receipt for the course were being issued by CLIL and it is CLIL who were paying service tax on the fee for the courses being received from the students, that the appellant for operating the coaching and training centres were only getting an amount of 25% of the fee, that the appellant are a sort of sub-contr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... being received by the appellant from CLIL, that in this regard, reliance is placed on the Newton Engg. & Chemicals Reported in 2008 (12) STR 378 (T) and Semac Pvt. Ltd. Vs.CST, Bangalore reported in 2006 (4) STR 475, that the entire exercise is revenue neutral, as even if the service tax is paid by the appellant, its cenvat credit would be available to the CLIL, that the bulk of the tax demand is time barred, as the longer limitation period is not available to the department for the reason that the appellant have not suppressed any relevant facts from the department, that the appellant have a strong prim facie case and, hence, the requirement of pre-deposit of service tax demand, interest thereon and penalty may be waived for hearing of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... organized the courses for which a part of the tuition fee is paid by CLIL to them. There is also no dispute that the CLIL have paid service tax on the entire amount of tuition fee received from the students. The point of dispute is as to whether in these circumstances the appellant's activity would attract service tax and whether in these circumstances, the appellant would be liable to pay service tax on the amount of 25% of the tuition fee being received by them from the CLIL. Prima facie, we find that the appellant's contract with CLIL is like a revenue sharing arrangements under which the appellant operate commercial coaching and training centres for CLIL and get a portion of the fee collected from the students. The Board in its circular ..... X X X X Extracts X X X X X X X X Extracts X X X X
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