Exemption for training materials under Notification 12/2003-ST supported prima facie case for waiver of pre-deposit and stay.

Sale of training or study materials by coaching classes was treated as a debatable issue under Notification No. 12/2003-ST, with some decisions recognising possible exemption where the sale is bona fide. The Tribunal noted that one cited case turned on adverse facts and another was only a stay order, but found that the appellant had shown a prima facie case by relying on the decision supporting exemption for such materials. On that basis, pre-deposit was waived and recovery of the disputed dues was stayed during the pendency of the appeal.

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Issues: Whether the appellant was entitled to waiver of pre-deposit and stay of recovery pending appeal in respect of service tax demanded on sale of training materials under Notification No. 12/2003-ST.

Analysis: The Tribunal noted that there were decisions taking the view that sale of study materials used by coaching classes could qualify for exemption under Notification No. 12/2003-ST. It also noted that another cited decision turned on facts showing that the alleged sale was not bona fide, while one cited order was only a stay order. On the materials before it, the Tribunal found the appellant had made out a prima facie case by relying on the reasoning in the decision supporting exemption for sale of such materials.

Conclusion: Waiver of pre-deposit was granted and recovery of the dues was stayed during pendency of the appeal, in favour of the appellant.

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