Appeal partly allowed: Income demands dropped from insurance, IGNOU, PTU; hiring charges, IIHT income confirmed.

The appeal was partly allowed. Demands related to income from insurance companies, IGNOU, PTU, and tuition fees for short-term vocational courses were dropped. However, demands related to hiring charges from IGNOU, income from IIHT, miscellaneous income, and income not forming part of the profit & loss account were confirmed.

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Issues Involved:
1. Demand on income from insurance companies.
2. Demand on income from Indira Gandhi National Open University (IGNOU) and Punjab Technical University (PTU).
3. Demand on hiring charges recovered from IGNOU.
4. Demand on income from Indian Institute of Hardware Technology (IIHT).
5. Demand on Bitcom Tuition fees.
6. Demand on miscellaneous income.
7. Demand on income not forming part of the profit & loss account.
8. Plea of limitation.

Issue-wise Detailed Analysis:

1. Demand on Income from Insurance Companies:
The appellants argued that income from insurance companies for providing CTCS to their agents is not taxable, citing several decisions including *The Bombay Flying Club* and *Academy of Maritime Education And Training Trust*. The department conceded that the issue was settled. The Tribunal held that training imparted to insurance agents, which is mandatory by law and recognized by IRDA, does not fall under the ambit of Section 65 (27) of the Finance Act, 1994. Consequently, the demand of Rs. 17,43,604/- was set aside.

2. Demand on Income from IGNOU and PTU:
The appellants claimed that they provided training essential for obtaining degrees and certificates from IGNOU and PTU, which are recognized by law, thus falling under the exclusion clause of CTCS. The Tribunal observed that accreditation from these universities is on record and both are constituted under law. The definition of CTCS exempts institutes issuing educational qualifications recognized by law. The demand confirmed by the authorities below was set aside.

3. Demand on Hiring Charges Recovered from IGNOU:
The appellant contended that the amount received was a reimbursement for expenses related to computer maintenance and stationery, thus exempted. The Tribunal noted that hiring charges cannot be considered as charges for imparting commercial training or coaching services and should be classified as supply of tangible goods. Since the Show Cause Notice did not propose the demand under this head, the demand was not sustainable and was set aside.

4. Demand on Income from IIHT:
The appellants argued that they provided training on behalf of IIHT, and the fees collected were remitted to IIHT, which had already discharged the service tax liability. The Tribunal, however, held that the appellant, being the service provider, was liable to pay the service tax and that any payment made by IIHT was not valid. The plea of double taxation was dismissed, and the demand of Rs. 10,51,472/- was upheld.

5. Demand on Bitcom Tuition Fees:
The appellants claimed that the income was from short-term vocational courses, exempted under notification no. 9/2003. The Tribunal observed that the training provided was vocational, enabling employment, thus exempted under notification no. 24/2004. The demand of Rs. 63,786/- was set aside.

6. Demand on Miscellaneous Income:
The Tribunal noted the absence of evidence to support the appellant's claim that the miscellaneous income was from the sale of scrap and library charges. The demand of Rs. 6,542/- was upheld.

7. Demand on Income Not Forming Part of the Profit & Loss Account:
The Tribunal found no evidence to support the appellant's claim of a calculation mistake. The demand of Rs. 28,748/- was upheld.

8. Plea of Limitation:
The Tribunal held that the appellant's failure to cooperate and provide requisite documents indicated an intent to evade duty. The Show Cause Notice was not barred by time, and the penalty imposed was justified for the confirmed demands.

Conclusion:
The appeal was partly allowed. The demands related to income from insurance companies, IGNOU, PTU, and tuition fees for short-term vocational courses were dropped. However, the demands related to hiring charges from IGNOU, income from IIHT, miscellaneous income, and income not forming part of the P&L account were confirmed.

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