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TMI Blog2018 (4) TMI 846X X X X Extracts X X X X X X X X Extracts X X X X ..... nd there cannot be any distinction between the regular colleges and the education imparted by the Appellant. In terms of CBEC Circular No. 59/8/2003 dt. 20.06.2003 the Appellant is not liable to service tax - also reliance placed in the case of COMMR. OF C. EX., TRIVANDRUM Versus TANDEM INTEGRATED SERVICES [2010 (8) TMI 401 - CESTAT, BANGALORE], where it was held that the colleges apart from imparting education for obtaining recognized degrees/diploma/certificates, also impart training for competitive examinations, such institutes or establishments are outside the purview of “Commercial Training or Coaching Institute”. Appeal allowed - decided in favor of appellant. - ST/87833/2014 - A/85719/2018 - Dated:- 22-3-2018 - SHRI RAMESH NAIR, MEMBER (JUDICIAL) AND SHRI RAJU, MEMBER (TECHNICAL) Appearance Shri Sagar Shah, C.A. for Appellant Shri Dilip Shinde, Asstt. Commr. (A.R) for respondent Per : Ramesh Nair The brief facts of the case are that the Appellant is a Public Charitable trust and running classes for graduation courses for the students through Yashwantaro Chavan Open University (YCMOU). They are also providing coaching for preparation of comp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... zed university in this case Yashwantrao Chavan Maharashtra Open university. In terms of the agreement with the YCMOU they are a study centre for graduation and other degree/ diploma courses run by the university and also produced the copy of the agreement. He has also produced the degree certificate of the students where the Appellant s name and code number is appearing as a study center. In reference to imparting education towards competitive exams conducted by the UPSC/MPSC etc. he submits that such education is also provided to the students as per the agreement between the university and themselves. That as per the definition of Commercial Training or Coaching Centre if any institutes provides both the courses i.e one recognized by the law, even than the autonomus courses which are not recognized by the law will not attract service tax, since the entire institute is outside the scope of Commercial Training or Coaching Centre . He relies upon the CBEC Circular No. 59/8/2003 dt. 20.06.2003 contending that the CBEC has clarified as under : Whether service tax is leviable on institutes providing commercial coaching in addition to recognized degree courses : Some insti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... courses as well as for competitive exams and other education programme in terms of agreement between the Yashwantrao Chavan Open University and the Appellant. The said university is recognized university and has appointed the Appellant as their study center. Clearly the Appellants are running parallel college for imparting education in degree/ diploma recognized by the law and cannot be differentiated with the other courses run by the regular courses. We have also seen the letter F1-52/2000(CPP-II) dt. 05.05.2004 issued by the Joint Secretary, University Grants Commission which clearly states that the Degrees/ Diplomas/ Certificates awarded by the Open University in conformity with the UGC notification on specification of degrees as equivalent to the corresponding awards of the traditional universities in India. Thus there is no doubt that the Appellant trust running courses are equivalent to regular courses of YCMOU and there cannot be any distinction between the regular colleges and the education imparted by the Appellant. Hence we are of the view that in terms of CBEC Circular No. 59/8/2003 dt. 20.06.2003 the Appellant is not liable to service tax. Our views are also based upon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the examination and the degree certificate awarded to private students and students studying in regular colleges, whether aided or self-financed affiliated to University, are the same. Therefore there is no distinction between the two classes of students namely, the students studying in the colleges affiliated to Universities and private students who take coaching in parallel colleges to write the same examinations. While the students studying in affiliated colleges cannot be subjected to service tax along with tuition fees and other fees levied by the management of those colleges students, who are studying in parallel colleges will have to bear the service tax as an additional burden along with tuition fees and other charges collected by the management of parallel colleges. The main reason why many students cannot join regular colleges affiliated to Universities is economical. Further on account of limited number of seats available in the affiliated colleges, the less brilliant will have to look for coaching elsewhere and they end up in parallel colleges. It is also a well-known fact that in interior and remote areas of the State, poor students even if eligible for admission ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at is the students. In view of the findings above, I find no distinction between students undergoing private study in parallel colleges and those undergoing study in affiliated colleges whether aided or self-financed in the same subjects for writing the same examinations. Therefore levy of service tax for services rendered by parallel colleges which indirectly falls on the students, but by simultaneously providing exemption to regular affiliated colleges allowing the students therein study free of tax is patently discriminatory and violative of the Art. 14 of the Constitution of India. Though the service tax is in the Union list, since education happens to be in the concurrent list and considering the encouraging policy of the State Government to improve the educational opportunities of the students in the State, wherefrom large number of educated people migrate outside the State and outside the country seeking employment, the view of the State Govt. was called for by this Court. After referring the matter to the Cabinet, the Under Secretary to Government has filed an affidavit in Court wherein he has stated that thought the State is helpless in regard to levy of service tax, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... addition to recognized degree courses : Some institutes like colleges, apart from imparting education for obtaining recognized degrees/diploma/certificates, also impart training for competitive examinations, various entrance tests etc. It is clarified that by definition, such institutes or establishments, which issue a certificate, diploma or degree recognized by law, are outside the purview of commercial training or coaching institute . Thus, even if such institutes or establishments provide training for competitive examinations etc., such services rendered would be outside the scope of service tax. 5.5 It can be seen from the above reproduced paragraph that the colleges apart from imparting education for obtaining recognized degrees/diploma/certificates, also impart training for competitive examinations, such institutes or establishments are outside the purview of Commercial Training or Coaching Institute . If the regular colleges affiliated to University are exempted from paying service tax for imparting training for the competitive examinations and various entrance tests etc., the respondent in this case being a parallel college, as is set out in Order-in-Original ..... X X X X Extracts X X X X X X X X Extracts X X X X
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