Statutory exemption for separately sold study material cannot be curtailed by a Board circular limiting relief to standard textbooks.

Separately invoiced study material sold by a coaching centre was held to fall within the statutory exemption under Notification No. 12/2003 because the material was charged and sold as goods in its own right. The Tribunal held that a Board circular could not narrow the scope of the notification by restricting exemption only to standard textbooks. On that basis, service tax on the study material was not sustainable and exemption remained available.

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Issues: Whether service tax was payable on the separately invoiced study material supplied to students by a coaching centre, and whether the exemption under Notification No. 12/2003 dated 20.06.2003 was available notwithstanding the Board circular treating only standard textbooks as exempt.

Analysis: The study material was shown separately in the invoice and its sale value was separately charged. The only controversy was whether such material could be denied exemption on the basis that it was not standard textbooks under the Board circular. The Tribunal followed its earlier decision holding that the circular's restriction was contrary to the statutory exemption granted by the notification and could not curtail the exemption otherwise available where the material was separately sold as goods.

Conclusion: The demand of service tax on the study material was not sustainable and the assessee was entitled to the exemption.

Ratio Decidendi: A Board circular cannot narrow the scope of a statutory exemption notification, and separately sold study material qualifies for exemption where the notification itself does not confine relief to standard textbooks.

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