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TMI Blog2024 (7) TMI 687X X X X Extracts X X X X X X X X Extracts X X X X ..... at such trainings did enable the trainees to seek employment in the field of their choice, or to improve the yield of the farmers by sharing and training them to the latest technological and other advancements in their field. Therefore, as long as there is the ability to seek employment or self-employment in terms of the explanation of the notification, the benefit of exemption cannot be denied, as has been held by this Tribunal in the case of M/s Frankfinn Aviation Services Pvt Ltd., vs Commissioner of Service Tax, New Delhi [ 2017 (3) TMI 1027 - CESTAT NEW DELHI ]. Consequently, the appellant is entitled to the exemption for the period prior to the amendment dated 27.02.2010 - As regards the demand for the subsequent period, the same would be taxable. However, the demand would be restricted to the normal period only. Eligibility of composition scheme under Works Contract Service - HELD THAT:- The dispute pertains limitedly in respect of the extension of benefit of the composition scheme without prior intimation to the Department. It has been submitted that the computation of demand is incorrect. It was also contended that the service tax in respect of works contract services has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fore squarely covered by the aforesaid decision. Extended period of limitation - HELD THAT:- It is observed that no cogent evidence has been adduced for invocation of the extended period, or establish suppression of facts with an intent to evade tax. Therefore, the demand for extended period, and the penalties are set aside. However, the liability to interest will be recalculated as per the demand to be recalculated by the adjudicating authority. The impugned order is upheld to the extent indicated above by way of remand, and the appeal is allowed partially. - MS BINU TAMTA, MEMBER (JUDICIAL) AND MS. HEMAMBIKA R. PRIYA, MEMBER (TECHNICAL) Shri B. L. Narsimahan, Shri Kunal Agarwal, Advocates for the Appellant Shri Rakesh Kumar, Authorized Representative for the Respondent ORDER The present appeal has been filed by M/s International Horticulture Innovation and Training Centre, Durgapura Horticulture Farm, Jaipur (hereinafter referred to as the appellant) to assail the Order-in-Original No. JAI-EXCUS-001-COM-054-14-15 dated 20.11.2014 wherein the demand of service tax under Commercial Coaching and Training Centre Service, Works Contract Services, Mandap Keeper Service and Scientific ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der the purview of service tax. She also informed M/s DCM Shriram Consolidated Ltd, New Delhi, a private partner met their operational expenses partly by providing a sum of Rs 60 lakh per annum and this arrangement was for a period of 5 years from the date of signing of MOU. Subsequently, Sh. Harivansh Yadav, Director of the appellant in his statement dated 3rd April 2013 stated that their institute was paying service tax on Works Contract Service only till June, 2012 and provided copies of GAR-7 challans depositing service tax of Rs. 4,67,771/- of service tax on turnkey projects under work contract service. However, on other services provided /received by them, he opined that no service tax was payable. Therefore, they have neither collected nor paid any service tax on such services. 2.2 A Show Cause Notice dated 09.10.2013 was issued to the appellants alleging non-payment of service tax on the aforesaid activities by contravening the provisions of Section 66, 67, 68, 69 and 70 of the Finance Act, 1994 read with Rules 4, 5, 6 and 7 of the Service Tax Rules, 1994. It was alleged in the Show Cause Notice that the appellants have not paid service tax on Commercial Training Coaching S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 004-ST dated 10.9.2004 and with respect to the receipts of Rs. 12,68,940/, which was towards the cost of study materials, no service tax can be levied on account of the exemption provided under Notification No. 12/2003-ST dated 20.6.2003. He further stated that in respect to receipts of Rs.21,54,450/-, no service tax was leviable as the said amount was received towards reimbursements of expenses. In this regard, the learned counsel relied on the following decisions: (i) Intercontinental Consultants and Technocrats P. Ltd. vs. Union of India, 2012- TIOL-966-HC-ST-DEL, affirmed by Hon'ble Supreme Court in [2018 (10) GSTL 401 (SC)]; (ii) Commissioner of S. T., Chennai vs. Sangamitra Service Agency, [2014 (33) STR 137 (Mad.)]; and (iii) Amit Sales vs. Commissioner of Central Excise, Jaipur-1, [2017 (47) STR. 156 (Tri. - Del.)] 3.2 As regards the receipt of Rs. 20,00,000/-, learned counsel submitted that the amount pertained to grants-in-aid given by National Mission for Medicinal Plants (NMMP) for development of model nursery for propagation of medicinal plants. Hence, service tax was not leviable and in support of his submission, he relied on the following circular and decisions: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng decisions which had followed this position of law: (i) J. R. Constructions vs. CCE, Jaipur, [2019 (7) TMI 1793-CESTAT NEW DELHI]; (ii) G. N. Buildev Pvt. Ltd. vs. CCE, Jaipur, [2019 (2) TMI 1176-CESTAT NEW DELHI]; (iii) Global Build Estate Projects vs. CCE, Jaipur, [2019 (4) TMI 1688-CESTAT NEW DELHI]; (iv) Vaishno Associates v. CCE ST, JAIPUR-I, [2018-TIOL-1486-CESTAT-DEL]; (v) ABL Infrastructure Pvt. Ltd. v. CCE, Nashik, [2015 (38) STR 1185 (Tri. Mumbai)]; (vi) Skyline Engineering Contract (India) Ltd. v. CST, New Delhi, [2018 (2) TMI 844- CESTAT NEW DELHI]; (vii) Nitson Amitsu Pvt. Ltd. v. Commissioner of ST, Kolkata-II, [2018 (4) TMI 1322- CESTAT KOLKATA]; (viii) Areva T D India Ltd. v. CCE ST, LTU, Chennai, [2018 (6) TMI 663-CESTAT CHENNAI]; and (ix) Allied Bitumen Complex (India) Pvt. Ltd. v. CCE, Calcutta-III, 2002 (141) ELT 373 (Tri. - Kolkata) 3.4 The learned counsel further contended that the demand of service tax of Rs. 93,361/- is on the amount received by the Appellant for leasing out space for conducting various educational seminars, under the category of 'Mandap Keeper Services'. For any service to be taxable under 'mandap keeper service', the immo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... therlands for the Appellant under the category of 'Scientific or Technical Consultancy Services'. As per the definition for a service to be covered within the purview of 'Scientific or Technical Consultancy Services', following ingredients needs to be satisfied: a) Nature of activity should be 'advice, consultancy, or scientific or technical assistance ; b) Rendered by a scientist or a technocrat, or any science or technology institution/organization to the other person; c) In one or more disciplines of science or technology. In this context, he submitted that in the present case, the activity of design of business master plan had been undertaken by M/s. Stitching PTC Netherlands, was neither in the nature of a scientist or a technocrat or a science or technology institution or organization. M/s. Stitching PTC Netherlands is a foreign-based company, having the expertise and know-how with respect to Horticulture. He placed reliance on the following decisions wherein it has been held that the services not been provided by a scientist or a technocrat or a science or technology institution or organization, is not taxable under the category of 'Scientific or Tech ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... empted under Notification No. 24/2004-ST dated 10.9.2004 was rejected by the Adjudicating Authority on the ground that issuance of amendment in Notification No. 3/2010 ST dated 27.02.2010, the horizon of definition of vocational training Institute was narrowed down to only Industrial Training Institute or Industrial Training Centre affiliated to the National Council for Vocational Training, offering courses in designated trades as notified under the Apprentices Act, 1961(52-of 1961). Therefore, the appellant was not covered under the Vocational training centre / institute as defined under the Notification No. 24/2014-ST dated 10.9.2004 as amended vide Notification No. 03/2010 ST dated 27.2.2010. Further, he submitted that horticulture itself is a commercial activity and subject to service tax. ii) As regards the claim of appellant to be eligible to pay service tax as per the provisions of Rule 3 of Works Contract (Composite Scheme for payment of Service Tax) Rules 2007, it is observed by the adjudicating authority that the appellants had received various amounts on account of Works Contract Services provided / to be provided but have neither provided the actual value of transfer of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pellant and M/s. DCM. From the agreement, it is understood that the activity involved in this matter is related to scientific or technical consultancy service provided to or to be provided by the appellant to the said M/s. DCM Shriram Consolidated Ltd. and received the amount as advance for such service. This amount is liable for payment of service tax. vi) As regards the invocation of extended period, learned Authorised Representative submitted that the appellant suppressed the fact from the department that they have received various amounts on account of Services of Commercial Coaching and Training Centre, Mandap Keeper, Works Contract, and Scientific or Technical Consultancy services and also paid amounts to M/s PTC+, the Netherlands not having permanent address or usual place of residence in India on account of receipt of Commercial Coaching Centre Service and Scientific or Technical Consultancy services which covered under taxable services as defined under the Finance Act, 1994 but not paying or short paying service tax on it. They have provided the details of taxable amount of the said services received and rendered only after initiated enquiry/ called for by the department. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3,67,81,896/-. At the outset, we consider the receipts indicated at serial numbers 5,6, 7 on which service tax demand has been confirmed. As regards the receipt of ₹12,68,940/- which was incurred towards the cost of study materials, we find that notification number 12/2003 -ST dated 20.06.2003 exempts the value of goods and materials sold by the service provider from the service tax leviable thereon. Similarly in respect of the receipt of ₹ 21,54,450/ which was an amount received towards reimbursement of expenses, we find that this issue stands decided in the case of Intercontinental Consultants and Technocrats Pvt Ltd., vs UoI [2018 (10) GSTL 401(SC)] wherein the Apex Court has held that in the valuation of taxable service, nothing more and nothing less than the consideration paid as quid pro quo for the service can be brought to charge , and consequently held that Rule 5(1) of the Rules runs counter and is repugnant to Sections 66 and 67 of the Finance Act and held it to be ultra vires. Further, with respect to the receipt of ₹20,00,000/ given as grant-in-aid by the National Mission for medicinal plants, we observe that this issue stands decided by the Supreme C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... part skills to enable the trainee to seek employment or undertake self- employment, directly after such training or coaching; (ii) 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. (Emphasis supplied) The said notification was subsequently amended by Notification No. 3/2010-ST dated 27.2.2010 whereby the definition of 'vocational training institute' was substituted with effect from 27.2.2010, as under: (1) vocational training institute means an Industrial Training Institute or an Industrial Training Centre affiliated to the National Council for Vocational Training, offering courses in designated trades as notified under the Apprentices Act, 1961(52 of 1961). Therefore, during the intervening period i.e., 10.09.2004 to 26.2.2010, the scope of the exemption was for all such centres providing vocational training/coaching that impart skills to the trainee. It was submitted by the learned counsel for the appellant that the amendment by Notification No. 3/2010-ST dated 27.2.2010 was prospective in nature did not have any retrospecti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ffices of State Agriculture and Horticulture department other Government Bodies, Scientists, Students, Farmers etc is covered under the activity of commercial coaching and training. We note that there is no dispute that the appellant provided training to farmers, students, teachers in the field of horticulture. Such training would enable the trainee to upskill themselves and carry forward the objective of the institute, viz., promotion of agricultural entrepreneurship. There is no dispute that such trainings did enable the trainees to seek employment in the field of their choice, or to improve the yield of the farmers by sharing and training them to the latest technological and other advancements in their field. Therefore, we are of the view that as long as there is the ability to seek employment or self-employment in terms of the explanation of the notification supra, the benefit of exemption cannot be denied, as has been held by this Tribunal in the case of M/s Frankfinn Aviation Services Pvt Ltd., vs Commissioner of Service Tax, New Delhi reported in 2017 (5) GSTL 154 (Tri. Del). Consequently, we hold that the appellant is entitled to the exemption for the period prior to the am ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e said category. Therefore, we are of the opinion that the appellant is eligible to avail the benefit of the Composition scheme, and it is noted that the appellant had already paid the Service Tax on the same. Therefore, the said demand is also not sustainable. 8. Mandap Keeper Services : We note that the impugned order has confirmed the demand of service tax of Rs. 93,361/- on the amount received by the appellant for leasing out space for conducting various educational seminars, under the category of Mandap Keeper Services . The relevant provisions with respect to 'Mandap Keeper Services' are extracted as under:- Section 65(66) mandap means any immovable property as defined in Section 3 of the Transfer of Property Act, 1882 and includes any furniture, fixtures, light fittings and floor coverings therein let out for a consideration for organizing any official, social or business function. Explanation. For the purposes of this clause, social function includes marriage; Section 65(67) mandap keeper means a person who allows temporary occupation of a mandap for a consideration for organizing any official, social or business function. Explanation; For the purposes of this claus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... taxable service means any service provided or to be provided, - (zze) to any person, by a commercial training or coaching centre in relation to commercial training or coaching: 9.1 Rule 3 of Import Service Rules provides that the services of Commercial Training or Coaching Services are performance-based services i.e. the place of performance of such service is the place of provision of such service. Relevant extract of Rule 3 of Import of Service Rules is produced as under: - 3. Taxable services provided from outside India and received in India.- Subject to section 66A of the Act, the taxable services provided from outside India and received in India shall, in relation to taxable services- (i) specified in sub-clauses (d), (m), (p), (q), (v), (zzq), (zzza), (zzzb), (zzzc), (zzzh), (zzzr), (zzzy), (zzzz), (zzza), (zzzzm), (zzzzu), (zzzzv) and (zzzzw) of clause (105) of section 65 of the Act, be such services as are provided or to be provided in relation to an immovable property situated in India; (ii) specified in sub-clauses (a), (f). (h), (i), (f). (1). (n). (o), (vw), (2), (zb), (c), (zi), (zj), (zn), (zo), (zq), (zr), (zt), (zu), (zv), (zw), (zz), (zza), (zze). (zzd), (zzf). (zz ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is not taxable. We observe that this issue stands covered in the following decisions: (i) Commissioner of Central Excise and Service Tax, vs Maersk India Pvt Ltd: [2015(40)STR 1059(Bom)] wherein the High Court of Bombay held in Para 7 that where the coaching service was performed/rendered abroad, the same cannot be liable to tax. (ii) Firmenich Aromatics India Private Limited vs Commissioner, C. Ex ST, Daman [2018(10) TMI 655-Cestat-Ahm.] wherein in Para 6 it was held that the services were performed outside India, and the payments were reimbursements of the expenses, hence there was no liability of tax. 9.3 However, as regards the remaining two trainings, it is not clear whether the said two trainings were also conducted at Netherlands, which would then not be liable to tax or whether they were conducted in India, as such training conducted in India would then be liable to tax. This aspect would have to be verified by the original authority and therefore, we remand this issue to the adjudicating authority to examine whether the same were provided in India or Netherlands, and decide the matter. 10. Liability of service tax on Scientific Technical Consultancy received by the appell ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be recalculated as per the demand to be recalculated by the adjudicating authority. 12. In view of the above discussions, we conclude as follows: (i) Liability of service tax on trainings imparted by the appellant under Commercial training or Coaching service: The demand is exigible to service tax post the amendment brought in by Notification 3/2010 dated 27.2.2010. We remand this matter to the adjudicating authority to recalculate the demand keeping in view that the demand will be for the normal period only. (ii) Eligibility of composition scheme under Works Contract Service: We hold that the appellant is eligible for the composition scheme, and consequently, the demand is set aside. (iii) Service Tax on Mandap Keeper services: We confirm the demand, however we restrict it to the normal period only. (iv) Liability of service tax under Reverse Charge Mechanism on foreign remittances: We set aside the demand in respect of the training held in Netherlands. We remand the matter to the adjudicating authority to ascertain the place of performance of the two trainings to calculate the liability of service tax under reverse charge mechanism, if any. (v) Liability of service tax on Scienti ..... X X X X Extracts X X X X X X X X Extracts X X X X
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