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TMI Blog2019 (5) TMI 267X X X X Extracts X X X X X X X X Extracts X X X X ..... MEMBER (TECHNICAL) For the Appellant: Shri Saurabh Dixit, Adv For the Respondent: Ms. Nitina Nagori, Jt. Commr. (AR) ORDER RAMESH NAIR The brief facts of the case are that the appellant is engaged in providing flying training to candidate for obtaining commercial pilot license. The case of the department is that the service of imparting flying training provided by the appellant to the trainees/candidates is a taxable service under the category of Commercial Training And Coaching Services as defined under section 65 (27), 65(26) and 65(105)(zzc) of the Finance Act, 1994. Accordingly, a Show Cause Notice was issued which was culminated into Adjudication Order whereby the demand was confirmed. Therefore, the present appeal. 2. Shri S.R. Dixit, Ld. Counsel appearing on behalf of the appellant submits that the appellant is engaged in the activity of providing training of flying of aircrafts and in promoting aviation in all aspects in general. The appellant is also approved by DGCA for this purpose under the provision of Rule 133(b)(1)(a) of the Aircrafts Rule, 1997. The appellant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under bona fide belief that the activity of repair and maintenance of aircrafts did not attract Service Tax during material period, especially since the appellant was not a Commercial concern and they were liable for a certain exemption 06/05-ST as well. Even cum tax benefit was also required to be given to the appellant. He submits that being the issue of complex nature involving interpretation of law, the demand is time bar. For the same reason, the penalty is also not imposable in terms of section 80 of the Finance Act, 1994. He also placed reliance on the judgments of this Tribunal in the case of Indian Institute of Management Vs. C.S.T.- Ahd. in final order no. A/10622-10623/2019 dated 01/04/2019. 3. Ms. Nitina Nagori, Ld. Jt. Commr. (AR) appearing on behalf of the Revenue reiterates the findings of the impugned order. 4. We have heard both sides and perused the records. We find that the issue is of taxability of flying training by the appellant who are approved by the DGCA, Ministry of Civil Aviation, Govt. of India. Such training provided by the appellant has been held non-taxable in the various judgments by Courts/Tribunal. In the case of Ind ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng centres will necessarily entail regulation by the same law of various facets of such training or coaching centres. 15. Seen in that light, there can be no doubt whatsoever that the activities of the petitioner are very much regulated by the Act and the Rules aforesaid and the instructions/regulations issued thereunder from time to time. 16. An analysis of the counter affidavit of the DGCA as set-out hereinabove would show that, (i) an institute as the petitioner cannot be setup without the approval of the DGCA; (ii) detailed requirements for approval have been made out in CAR Section 2, Series E Part VII; (iii) such approval is given only after the institution satisfies DGCA that it has the facilities, equipments, training aids, faculty, library and other infrastructure for providing such training and follows the syllabus prescribed by the DGCA to be coached/trained/imparted in the said institute; (iv) the approval is not a onetime approval but has to be obtained year after year and at the time of each renewal DGCA has to be satisfied of existence of the compliances/parameters; (v) the institutes are obligated under para ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing out by any person any modification or repair affecting safety of any aircraft in respect of which a certificate of airworthiness has been issued, save in accordance with the Rules. Rule 54 provides that the certificate of airworthiness shall be signed by appropriately licensed engineers authorized by organizations approved by DGCA. Rule 60 in Part VI defines maintenance of an aircraft as performance of works necessary for the purpose of ensuring that the aircraft is airworthy and safe including servicing of all aircrafts. Rule 60(3) prohibits flying of aircrafts unless maintenance of the aircraft has been carried out by or under the supervision of a person licensed, approved or authorized for the said purpose. Rule 61 provides for grant of licenses, authorizations and approvals to persons to act in the capacity of Aircraft Maintenance Engineers, Authorized or Approved persons, to sign in connection with repair or maintenance of aircrafts. Rule 61(2) prescribes the requirements which an applicant for the issue of a Maintenance Engineer s license is required to satisfy. Though the applicants are required to possess the minimum qualification of three years diploma in any branch o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urse Completion Certificate; (k) the syllabus for the various examinations; and, (l) maintenance of student records by such institutes. 20. The position which thus emerges is that :- (A) That successful completion of Aircraft Maintenance Engineers course from an approved training school by itself does not authorize such candidate to certify the airworthiness of an aircraft or its repair or maintenance. For the same, an examination to be conducted by the DGCA is to be passed. (B) For appearance in the said examination, it is not essential to undergo the course offered by the approved training school and others are also eligible to take the said examination. 21. Nonetheless, the law dealing with the subject of aircrafts has not left the institutes imparting such courses/training and which course completion/training makes the successful candidates eligible to one year exemption, unregulated. It is not as if anyone can start, offering such course and imparting training. The Act, Rules and CAR provide for approval of institutes such as the petitioner s. DGCA re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... titute from an unapproved one and a successful candidate from an approved institute would be entitled to enforce the right, conferred on him by the Act, Rules and CAR, to one year relaxation against the DGCA in a Court of law. The inference can only be one, that the Course Completion Certificate/training offered by such Institutes is recognized by law. 26. There can be no doubt that such recognition through the Rules framed as aforesaid and through issuance of CAR, is a recognition by law, which is defined in Black s Law Dictionary, 8th Edition as the aggregate of legislation, judicial precedents and accepted legal principles and the set of rules or principles dealing with a specific area of legal systems. The Rules and the CAR aforesaid dealing with aircrafts, there can be no doubt, are law. The Supreme Court in Narsingh Pratap Singh Deo v. State of Orissa - AIR 1964 SC 1793 held that a law generally is a body of rules which have been laid down for determining legal rights and legal obligations which are recognized by Courts. Similarly, in R.S. Nayak v. A.R. Antulay - (1984) 2 SCC 183 it was held that law includes any Ordinance, By-law, Rule, Regulation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5/04/2011. Accordingly, the instruction given by the department and the Show cause notice given to the petitioners have been quashed. This Tribunal in the case of Ahmedabad Aviation and Aeronautics Ltd. (supra), relying upon the decision of the Hon ble Allahabad High Court relying in the case of Garg Aviation Ltd. set aside the demand under Commercial Training and coaching services in respect of flying training. In the case of Star Aviation Academy passed by this Tribunal, it was held that Aircrafts maintenance engineering training imparted by an institute authorized by Directorate General of Civil Aviation issued by AME course completion certificate which is valid and recognized under Indian Aircrafts Act, 1934. Such services are not leviable to Service Tax under the category of Commercial training or coaching services. The similar issue has been settled in the case of Indian Institute of Aeronautics and Engineering, Azad Institute of Aeronautics and Engineering, M/s Indira Gandhi Rashtriya Uran Akademi, Hindustan Academy of Aircraft Maintenance Engineers Lko. (supra). In view of above catena of judgments, the issue is no longer res integra. Accordingly, the impugned order is set ..... X X X X Extracts X X X X X X X X Extracts X X X X
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