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2018 (4) TMI 664

ing any certificates to the students and cannot claim exemption; coaching for the intermediate education and for National Entrance Examination are distinct activities and coaching for such entrance examinations does not lead to issue of any certificate recognized by law - N/N. 33/2011-ST. - For the period 2011-2012 - Held that: - For applicability of the exemption, post 1.5.2011, plain reading of the notification is that the ‘coaching or training’ should lead to issue of a certificate / degree / diploma or educational qualification recognized by law. It is significant that, post 1.5.2011, even the controversy relating to ‘issue of certificate / degree etc.’ is settled in favour of the appellant as the notification clearly provided that the coaching or training should ‘lead’ to issue of a certificate etc - It is settled law that if the plain meaning of the exemption notification covers the assessee, the benefit should be allowed - even if courses can be artificially split as intermediate and entrance coaching, the essential character flows from the intermediate training and hence the appellants are eligible for the exemption under N/N. 33/2011-ST with effect from 01.05.2011. - .....

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ching Centers - These centers were established in locations inside and outside the State of Andhra Pradesh in order to prepare students so as to enable them to appear for various competitive exams but for the period concerned in these appeals 2011 to 2015, these coaching centers were not functionable. 4. The appellants Society, through their own Junior Colleges and the junior colleges of other societies under its management imparts education to the students for intermediate courses; are recognized by the Andhra Pradesh Intermediate Board for providing education for 11th and 12th standard students; they follow guidelines for the syllabus prescribed by the Andhra Pradesh Intermediate Board conducts regular internal assessments, follows a standard admission procedure and imparts education on various subjects as per the guidelines of Intermediate Board. Appellants Society in certain junior colleges also provide residential schooling. Various courses are offered by the appellants society to their students towards intermediate in the Junior Colleges are (i) Maths/Physics/Chemistry (Regular Intermediate), (ii) Intermediate+IIT-JEE (along with AIEEE+BITSAT) (iii) Intermediate+EAMCET+AIEEE+ .....

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r have been deleted and Notification No. 33/2011-ST grants an exception which is not applicable to appellant and from 01.07.2012 the activity rendered by the appellant is covered under the definition of service and the said services does not fall under any entry in the Negative List or mega exemption notification. The adjudicating authority after following due process of law confirmed the demands raised along with interest and also imposed penalties. Subsequently, a corrigendum was issued on the basis of details of the fees collected by the appellant under various Head indicated in the balance sheet and fee deductions were allowed by the adjudicating authority. It is against these deductions, Revenue is in appeal while the appeals of the appellants are against the confirmation of demand. 7. Learned Counsel for the appellant draws our attention to the definition of commercial training or coaching center for the period in question from 01.05.2011 and submit that that there was an amendment with definition by notification 33/2011-ST dt 25.04.2011 and reads the same. 7.1. It is the submission that the effect of the amendment was that while even an institution / establishment providing .....

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ion of Section 67 of the Act which subservient to Section 66 and Section 65, service tax needs to be determined on the value of taxable services. 7.2 It is also the finding of the lower authority that the appellant is liable to pay service tax for the services received by them like legal services, manpower recruitment or supply agency services, renting of immovable property services under reverse charge mechanism. It is his submission that these services are not taxable in the hands of the appellant as Mega Exemption Notification No. 25/2012 exempts the taxable services to any other entity other than the business entity and appellant being a registered society providing education and being a charitable trust cannot be held as business entity and is also exempt from discharge of tax on manpower recruitment or supply agency services by entry No. 9(b)(iii) of the Mega Exemption notification No. 30/2012. He pleads for allowing their appeals and rejecting the appeals of Revenue. 8. Learned Special Counsel appearing for the Revenue reiterates the finding of the appellate authority and submits that the services provided by the appellants society can be categorized broadly into three diffe .....

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roduced before the lower authorities and details thereof were explained appellant s Counsel demonstrated the same before the Tribunal by taking two examples. Production of these documents before the lower authorities is not disputed and perusal of sample copy of T rolls and mark sheet as is given to various students indicate that the said mark sheet is issued by the Board of Intermediate Education, Andhra Pradesh jointly with the signature of the Principal of the College/Jr. College/ Society affiliated with the appellants and the computerized merit list also includes the Intermediate pass certificate cum memorandum of marks sheet issued to the students who appeared for the intermediate education of Andhra Pradesh. Mere perusal of the said documents would indicate that the appellants Society is recognized by the Board of Intermediate Education, Andhra Pradesh and are issuing mark sheets jointly signed by the Principal and Controller of the Examinations, Board of Intermediate Education, A.P. In our considered view, the said mark sheets issued by the appellants jointly with the signature of Controller of Examination has to be considered as the certificate which is recognized by any la .....

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ification covers the assessee, the benefit should be allowed. 18. In fact, the Commissioner himself admits that the appellants are not liable to pay service tax in respect of the intermediate courses but are liable to pay service tax on the coaching / training provided for entrance examinations. As there is no break-up of the fees for Intermediate and entrance courses, the demand stands confirmed on the entire fees collected by the appellats. 19. It is submitted that the fees collected by the appellants cannot be artificially split and a portion thereof allowed exemption from service tax and another potion cannot be subject to service tax. In the case of Commissioner of Central Excise v. Larsen & Toubro Ltd. - 2015 (39) STR 913 (S.C.), the apex court has held with reference to composite works contracts, that in absence of a mechanism a composite activity cannot be vivisected for the purpose of levying service tax. 20. Reading of prospectus and other materials indicate that the training / coaching provided by the appellants in the Intermediate Colleges are composite and an integrated course, whereby the students become eligible for intermediate qualification and simultaneously b .....

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ation as a part of an approved vocational education course; 27. The Mega Notification No. 25/2012-S.T. dated 20.6.2012 exempted certain taxable services from the whole of the service tax leviable thereon under Section 66B of the Finance Act, 1994. 28. As per S1 NO.9 of the Mega Exemption Notification No. 2512012-S.T, dated 20.6.2012, any service by way of 'auxiliary educational services' or renting of immovable property services provided to an educational institution or provided by an educational institution in respect of education exempted from service tax shall also be exempt from the payment of service tax. Further, auxiliary educational services have been defined as services relating to imparting any skill, knowledge, education or development of course content or any other knowledge. 29. The Appellant submits that their activity is squarely covered under the negative list under Section 66D(I), sub-clause (i) and (ii) and also in the definition of 'auxiliary educational services' since they are involved in imparting skill, knowledge and education which has been acknowledged by the Ld. Commissioner also. 30. Furthermore, the Appellants also place reliance on Secti .....

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l institution" means an institution providing services specified in clause (I) of section 66D of the Finance Act, 1994 (32 of 1994). 38. The exemption provided under Mega Exemption was subject to Section 66D of the Finance Act, 1994. It is submitted that the amendments brought in the Mega exemption from time to time did not have any impact on the Entry 9 in Negative List under Section 66D of the Finance Act, 1994 is an acceptable proposition. 39. Therefore, essentially an activity by an 'education institution' as defined with reference to Section 66D of the Finance Act, 1994 was outside the purview of service tax and the Appellants are squarely covered in the ambit of the same, accordingly demand of service tax under any category fails. 40. In view of the forgoing, we find that the impugned orders of the adjudicating authority are unsustainable and liable to be set aside and we do so, all demands involved in these appeals are set aside, with consequential relief. 41. Since we are holding in favour of the appellant on merits in all these appeals, the appeal filed by Revenue is rejected. 42. We have specifically addressed the issue raised in these appeals considering the .....

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