By TIOL News Service

MUMBAI, APRIL 05, 2018: THE Appellant is engaged in rendering 'Commercial Training or Coaching Services'. They sell prospectus of their institute detailing about the institute, faculties and various courses offered by them.

Based on audit observation, service tax Demands for the period 01.04.2006 to 31.12.2010 were raised by including sales value of prospectus in the assessable value of services.

The demands were confirmed along with penalties by the lower authorities.

In appeal before CESTAT, the appellant argued that the demand is not sustainable as the sale of prospectus is not covered under the services of 'Commercial Training or Coaching Service'; that sale of prospectus is covered under the Maharashtra VAT Act, 2002 under Entry C - 76; that the demands are time barred.

The AR, while reiterating the findings of the lower authorities placed reliance on the decisions in Vigyan Gurukul - 2009-TIOL-261-CESTAT-DEL and Neminath Fabrics Pvt. Ltd. - 2011-TIOL-10-HC-AHM-CX.

The Bench considered the submissions and observed that the sale of prospectus is not a part of the 'Commercial Training or Coaching Services' as held in the precedent judgment of the Tribunal in case of Balaji Society - 2014-TIOL-1873-CESTAT-MUM.

The CESTAT further added -

+ We find that the prospectus is only for the purpose of screening of students by way of Admission Screening Examination and is not a part of the services. The student, only by filling of prospectus, does not become entitled to get coaching from the Appellant. Hence the same cannot be considered as part of 'Commercial Training or Coaching Services'.

+ No evidence has been shown to substantiate the charges for invoking demand of extended period or imposition of penalty.

Accordingly, the demand and penalty was set aside and the appeals were allowed with consequential relief.

In passing: Also see 2014-TIOL-443-CESTAT-MUM.

(See 2018-TIOL-1082-CESTAT-MUM)