2005 (8) TMI 2 - HC - Service Tax

Commercial Training and Coaching Centre - Conducting examination to obtain degree or certificate awarded by any agency created by law.

Summary

Issues:
Challenge against provisions of Finance Act, 1994 authorizing service tax on commercial training and coaching centers. Validity of Ext. P3 notice demanding registration and service tax.

Analysis:

1. The petitioner, a charitable society, operates a parallel college providing coaching for university examinations and computer courses for "A" and "O" level exams conducted by the DOEACC society. The challenge is against the imposition of service tax on services provided by commercial training centers. The petitioner argues that being a parallel college, it should benefit from a previous judgment that ruled against demanding service tax from parallel colleges, deeming such demands discriminatory and violative of Article 14 of the Constitution.

2. The petitioner has presented certificates from the DOEACC society, accrediting them to conduct computer courses for coaching students for "A" and "O" level exams. The judgment in a related case established that educational institutions offering courses necessary to obtain degrees or certificates from legally established agencies are exempt from service tax under the Finance Act, 1994. Consequently, the petitioner, being engaged in providing courses essential for certification exams conducted by the DOEACC society, is not liable to pay service tax.

3. In light of the above analysis and the precedent set by previous judgments, the High Court allows the writ petition, thereby quashing the Ext. P3 notice issued by the third respondent demanding registration and service tax from the petitioner. The court upholds the petitioner's contention that as a parallel college offering courses integral to certification exams, they are exempt from the service tax provisions of the Finance Act, 1994.