2013 (5) TMI 592 - HC - Service Tax

Commercial coaching or training center – u/s 65(27) – Notification No.33/2011-ST - Whether Flying Training Institutes providing training for obtaining Commercial Pilot License (CPL) and Aircraft Engineering Institutes for obtaining Basic Aircraft Maintenance Engineering License (BAMEL) come in the category of coaching centers as laid down in Section 65(27) of the Finance Act, 1994 and therefore assessable to service tax or not? - SCN was issued by the respondent / Additional Commissioner of Service Tax to the petitioner.

Held that:- Section 65(27) excluded from the domain of commercial training or coaching centers, training centers or establishments issuing any certificate or diploma or degree or any educational qualification recognized by law. Even after 30th April, 2011, amendment of section 65(27) though the part of Section 65(27) making such exclusion has been deleted but the Notification No.33/2011-ST issued in exercise of powers u/s 93 of the Finance Act has exempted, coaching or training leading to grant of a certificate or diploma or degree or any educational qualification which is recognized by any law from the whole of Service Tax leviable u/s 66 of the Finance Act.

The Act, Rules and CAR distinguish an approved Institute 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.

An educational qualification recognized by law will not cease to be recognized by law merely because for practicing in the field to which the qualification relates, a further examination held by a body regulating that field of practice is to be taken. The recognition accorded by the Act, Rules and CAR supra to the Course Completion Certificate issued by the Institutes as the petitioner cannot be withered away or ignored merely because the same does not automatically allow the holder of such qualification to certify the repair, maintenance or airworthiness of an aircraft and for which authorization a further examination to be conducted by the DGCA has to be passed/cleared. Thus, the Instruction and the SCN are quashed.