TMI Blog2013 (5) TMI 592X X X X Extracts X X X X X X X X Extracts X X X X ..... f 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 examina ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ough the candidates get the final licence i.e. BAMEL from the DGCA after qualifying further examination conducted by the DGCA; (iv) that though service tax in India was introduced in the year 1994 but commercial training or coaching services were brought under the service tax net only with effect from 01.07.2003 by insertion of Clause 65(105)(zzc) in the Finance Act by making services provided by a commercial training or coaching centre in relation to commercial training or coaching as a taxable service; (v) however vide Section 65(27), preschool coaching and training centre or any institute or establishment which issues any certificate or diploma or degree or any educational qualification recognized by law for the time being in force, was excluded from the meaning of commercial training or coaching centre; (vi) that though Section 65(27) was amended with effect from 01.05.2011 to remove the exclusion earlier provided to preschool coaching and training centre or any institute or establishment which issues educational qualification recognized by law but vide Notification No.33/2011-ST dated 25.04.2011 with effect from 01.05.2011, similar exemption was granted to preschool a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t is the responsibility of DGCA to ensure safe air transport services and enforcement of civil air regulations, air safety and air worthiness standards; (iii) that the DGCA regulations are in the form of the Act, Rules, CAR and the Aeronautical Information Circulars etc.; (iv) that it is the DGCA which is responsible for issue of AME and Pilot licences as per the International Civil Aviation Organization (ICAO) standards; (v) that the Central Examination Organization is one of the Directorates of the DGCA which conducts the written examination for issue of Pilot and AME licences; (vi) AME licences are issued under the provision of Rule 61 of the Aircraft Rules; (vii) Rule 133B provides that DGCA can approve the AME institutes / schools for imparting ab-initio training to the candidate so that they can appear in DGCA AME licence examination; (viii) that the detailed requirements for approval of AME institutes / schools are given in CAR Section 2, Series E Part VII; (ix) that the DGCA approves the AME training institutes after satisfying with the statutory requirements with regard to syllabus, facilities, equipment, mock-ups, training aids, faculty, library and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inter alia relating to maintenance of aircraft; and, (e). Rule 133B defining approved organization as an organization engaged inter alia in the activity of training schools and requiring such organization to comply with requirements specified in the Civil Airworthiness Requirements. 8. It is the contention of the senior counsel for the petitioner that the Course Completion Certificates issued by the petitioner are thus recognized by law and the petitioner is thus exempt from Service Tax. It is contended that the Department was also earlier taking the same view and the Minutes of the Meeting held on 19th June, 2012 of the CBEC in this regard were handed over in the course of hearing. Reliance is placed on para 13 of Pahwa Chemicals (P) Ltd. Vs. Commissioner of Central Excise, New Delhi (2005) 2 SCC 720 laying down that CBEC has no power to issue instructions or orders contrary to the provisions of the Act or in derogation of the provisions of the Act and on Siemens Ltd. Vs. State of Maharashtra (2006) 12 SCC 33 to contend that where a notice is issued with premeditation, a writ petitioner would be maintainable thereagainst, since such a notice ceases to remain in the realm of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gnized by law‟. Even after 30th April, 2011, though the part of Section 65(27) making such exclusion has been deleted but the Notification dated 25th April, 2011 supra issued in exercise of powers under Section 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 under Section 66 of the Finance Act‟. 14. We have wondered, what could be the reason for exempting from payment of service tax those training or coaching centres, even though commercial, whose certificate/degree/diploma/qualification is recognized by law. The only plausible reason, according to us, can be to exclude from ambit of service tax those training or coaching centres which are otherwise regulated by any law in as much as recognition of certificate/degree/diploma/qualification conferred by such training or coaching 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 reg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... equires all persons to whom such directions are issued to comply with the same. The CAR owe their origin and binding nature to Section 5A of the Act. Section 11 makes flying of an aircraft in a manner so as to cause danger to any person, and which danger would be implicit in flying in breach and violation of the Rules and CAR, a punishable offence. Contravention of CAR is also made a punishable offence under Section 11A of the Act. The Rules to be framed under the Act are under Section 14 of the Act subject to previous publication and under Section 14A of the Act required to be laid before each House of the Parliament and subject to modification or repeal by Parliament. 18. Part VI of the Rules deal with airworthiness of aircrafts and requires each aircraft to have a certificate of airworthiness issued under the Rules. Rule 52 thereunder prohibits carrying 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... od of training in the approved training institute would be counted as maintenance experience for the purpose of completing total aeronautical experience required to become eligible for appearing in the Aircraft Maintenance Engineering license examinations; (b). objectives of such training; (c). requirements for approval; (d). scope of the training; (e). qualification of admission into such institutes; (f) period of training; (g). holding of examinations and the content thereof; (h). issuance of mark-sheets to the successful candidates; (i). On Job Training; (j). issuance of a serially numbered certificate, the format of which is to be approved by the DGCA, called the Course 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. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cate/training/qualification offered by Institutes which are without approval of DGCA would not confer the benefit of such relaxation. Thus, the certificate/training/qualification offered by approved Institutes, has by the Act, Rules and the CAR been conferred some value in the eyes of law, even if it be only for the purpose of eligibility for obtaining ultimate licence/approval for certifying repair/maintenance/airworthiness of aircrafts. 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. 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 lega ..... X X X X Extracts X X X X X X X X Extracts X X X X
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