TMI Blog2014 (10) TMI 64X X X X Extracts X X X X X X X X Extracts X X X X ..... demand, neither the courses were recognized by law nor the institutes/establishments conducting the courses were approved. Therefore, these institutes clearly fall under the definition of ‘commercial training or coaching centre' as defined in law and the services rendered by them are liable to service tax and we hold accordingly. Appellant had discharged bulk of the service tax demand confirmed (that is ₹ 5.27 Crore (approx.) out of about ₹ 6.59 crore) before the issue of show cause notice. In these circumstances imposition of equivalent amount of penalty under section 78 of the Finance Act, 1994 is not warranted. Accordingly we set aside the penalty imposed under Section 78 on the appellant - Decided partly in favour of assessee. - Appeal No.ST/167/2009 - Final Order No. A/1397/2014-WZB/C-I(CSTB) - Dated:- 25-8-2014 - P R Chandrasekharan and Ramesh Nair, JJ. For the Appellant: Shri L Badrinarayanan, Adv. For the Respondent : Shri D Nagvenkar, Additional Commissioner (AR) JUDGEMENT Per: P R Chandrasekharan: The appeal arises from Order-in-Original No: 25/P-III/STC/COMMR/2008-09 dated 31/03/2009 passed by the Commissioner of Central Excise, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng service tax for the period 01/07/2003 to 31/03/2006 amounting to ₹ 6,59,02,514/- along with interest thereon and proposing to impose penalties and also proposing to appropriate the amount of ₹ 5,27,37,740/- paid by them under protest. The said notice was adjudicated vide the impugned order wherein the service tax demand along with interest was confirmed and equivalent amount of penalty was imposed under Section 78 of the Finance Act, 1994. 3. The ld. Counsel for the appellant made the following submissions. 3.1 The activity undertaken by the appellant is education and is not covered under the taxable service of commercial coaching or training'. The appellant is providing education as per its own curriculum and testing them based on examination conducted as well as assessed by them and the said activity cannot be termed as commercial training or coaching. 3.2 The appellants are registered as a charitable society and are non-commercial. The income earned by the appellant is exempt from income tax under Section 10(23C) of the Income Tax Act, 1961. Therefore, the nature of the activity undertaken by the appellant are not commercial and hence the appellant d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ute as defined in notification 9/2003-ST and 24/2004-ST and therefore, would be eligible for the benefit under the said notifications. 3.6 The appellant should be treated on par with IIMs being identical in terms of legal entity status, curriculum and course recognition/ranking as per the various surveys conducted on Management Schools in India. 3.7 In many case, the extended period of limitation is not invokable and there was no suppression, willful mis-statement of facts or collusion on the part of the appellants and there was no intention on the part of the appellant to evade service tax. Prior to the decision of the larger bench of this Tribunal in the case of Great Lakes Institute of Management vs. CST, Chennai 2013 (32) S.T.R. 305 (Tri. - LB), there have been many conflicting decisions such as Malappuram District Parallel College Association [2006 (2) STR 321 (Ker)] and St. Antony's Educational and Charitable Society [2006 (1) STR 137 (Ker)] = wherein the levy of service tax on parallel colleges was struck down as being violative of Article 14 of the Constitution. Further this Tribunal in a series of decisions such as National Institute of Bank Management 2013 (32) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ritable trust, is not tenable in law. 4.3 A larger Bench of this Tribunal in the case of Great Lakes Institute of Management vs. CST [2013 (32) STR 305] after examining at length the various decisions on the matter held that the taxable service of commercial training or coaching occurs when any institute or establishment is engaged in the activity of imparting skill, knowledge or lessons on any subject or field, irrespective of whether imparting such skill, knowledge or lessons is in respect of a particular discipline or a broad spectrum of disciplines/academic areas; irrespective of the nomenclature or description of the institute or establishment, as a coaching or training centre or an educational institution; regardless of whether an institute or establishment is incorporated by or registered under any law; and irrespective of distinctions on the basis of curriculum, course content, teaching methodology, course duration or otherwise. In view of this decision, the coverage of Sri Balaji Society under commercial training or coaching centre' stands settled. 4.4 In the case of Sadhana Educational People Dev. Service Ltd. [2014 (33) STR 575] it was held by this Tribunal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ;Explanation. - For the removal of doubts, it is hereby declared that the expression commercial training or coaching centre occurring in this sub-clause and in clauses (26), (27) and (90a) shall include any centre or institute, by whatever name called, where training or coaching is imparted for consideration, whether or not such centre or institute is registered as a trust or a society or similar other organisation under any law for the time being in force and carrying on its activity with or without profit motive and the expression commercial training or coaching shall be construed accordingly; 5.3 The issues pertaining to interpretation of commercial training or coaching', taxable service specified in section 65 (105) (zzc) of the Finance Act, 1994, section 65(26) defining commercial training or coaching' and section 65 (27) defining commercial training or coaching centre' were referred to a Larger Bench of this Tribunal and the larger bench in the Great Lakes Institute of Management Ltd. (supra) examined these issues at length after considering the various decisions on the matter and the circulars issued in this regard by the CBEC and answered the referenc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es/establishments conducting the courses were approved. Therefore, these institutes clearly fall under the definition of commercial training or coaching centre' as defined in law and the services rendered by them are liable to service tax and we hold accordingly. There is also no merit in the contention that during the material period no AICTE approval was required. AICTE only approves the institute and the course. The degree that is awarded has to be recognized by the law. During the period from 1-7-2003 to 31-3-2006, none of the degrees/diplomas awarded by the appellant was recognized by law. Therefore, we do not find any merit in these contentions raised by the appellant. 5.5 As regards the contention of the appellant that the courses conducted by them were vocational in nature and therefore, they were entitled to exemption from tax under notification No. 9/2003 and 24/2004, an identical issue was examined by this Tribunal in Sadhana Educational People Dev. Service Ltd. in respect of Postgraduate diploma courses in Management conducted by the appellant therein. After examining the provisions of the notification and the scope of vocational training for engineering and n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce tax. It was only during the course of investigations by the department that these appellants disclosed the relevant facts and, that too, under compulsion and in a piecemeal manner. This state of affairs has been clearly brought out through the learned Special Consultant's submissions recorded in para 9(f) of this order in respect of the ICFAI cases. We have seen more or less the same state of affairs in respect of other assessees also. The show-cause notices and the relied-upon documents loudly disclose the suppression of the facts by these parties whose intent to evade payment of service tax is evident from the records. In the case of Mehta Co. (supra), the Hon'ble Supreme Court held that the extended period of 5 years prescribed under the proviso to Section 11A(1) of the Central Excise Act (which provision is pari materia with the proviso to Section 73(1) of the Finance Act, 1994) could be reckoned from the date of acquisition of knowledge by the department. The ratio of the decision is squarely applicable to the present cases. 5.8 In Commissioner of Central Excise, Visakhapatnam vs. M/s. Mehta Co 2011 (264) E.L.T. 481 (S.C.) , -, the hon'ble apex court hel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (191) ELT 1051 (Tri-Mum), it was held that blind belief cannot be a substitute for bona fide belief. Therefore, we do not accept the plea of bonafide belief claimed by the appellant. Consequently the demand of service tax confirmed in the impugned order is clearly sustainable in law and we hold accordingly. Once the demand for tax is upheld, the demand for interest thereon is automatic and consequential. Accordingly we uphold the demand for interest on the service tax demand confirmed. 5.10 As regards the payment towards service tax made by the appellant of ₹ 5.27 crore under protest, from the records of the case as well as the submissions made during the hearing, we note that the said service tax has been collected from the students who attended the various courses conducted by the appellant. As regards the time limit for making the demand, the said time limit would apply only in case of non-payment or short payment of tax. In respect of payments made, even if under protest, the question of time limit does not apply. Only the protest has to be vacated and the payments appropriated. Therefore, the question of refund of the amount on account of time bar will not apply. In a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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