Tribunal rules scholarships as fee discounts, not subject to service tax. Full waiver granted.

The tribunal ruled in favor of M/s Resonance Eduventures Pvt. Ltd. and Shri R. K. Verma, confirming that the scholarships provided were essentially fee discounts and not subject to service tax. The appellants had paid service tax on the total amount received for their services, and the scholarships were deemed as concessions given to students. As a result, the tribunal granted a full waiver of pre-deposit and stayed the recovery of the disputed liability pending appeal.

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Issues:
- Confirmation of service tax demands along with interest and penalties
- Disallowance of Cenvat credit
- Contesting impugned demands related to scholarships/fee discounts/fee concessions
- Nature of scholarships as fee discounts
- Invocation of extended period for raising demand

Confirmation of Service Tax Demands:
The appeals filed by M/s Resonance Eduventures Pvt. Ltd. and Shri R. K. Verma were accompanied by stay applications due to the confirmation of service tax demands, interest, penalties, and disallowance of Cenvat credit. While the appellant reversed the disallowed Cenvat credit amount of Rs. 8,24,031, the remaining impugned demands were contested on the basis that service tax was not paid on amounts related to scholarships, fee discounts, and fee concessions. These amounts were deemed non-deductible from the assessable value as they were provided to students as scholarships.

Nature of Scholarships as Fee Discounts:
The appellant argued that they had already paid service tax on the total amount received for providing commercial training or coaching services, and the so-called scholarships were actually fee concessions or discounts given to students. They maintained that there was no willful misstatement or suppression of facts, thus challenging the invocation of the extended period for raising the demand. On the contrary, the respondent contended that scholarships constituted amounts given to students and should not be deducted from the full fee required from students.

Judgment and Conclusion:
After considering both parties' contentions, the tribunal found that the appellant had indeed paid service tax on the entire amount received for their services. The scholarships were identified as fee discounts granted to specific students, resulting in the collection of discounted fees from those students. The tribunal emphasized that the actual nature of the transaction, not just the name given to it, was crucial. As the scholarships were essentially fee discounts, the tribunal granted a full waiver of pre-deposit and stayed the recovery of the impugned liability during the appeal's pendency. Additionally, a miscellaneous application for early hearing of the stay application was also disposed of.

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