Scholarship fee concessions under a declared coaching scheme are not non-monetary consideration for service tax valuation.

Scholarship-based fee concessions under a pre-declared coaching scheme were not treated as non-monetary consideration for service tax valuation. The taxable value under Section 67 of the Finance Act, 1994 was held to be the gross amount actually charged, and tax had already been paid on the fees received from students. The concessional portion granted under the publicly notified scholarship scheme could not be added to the taxable value under the valuation rules. The same reasoning had been applied in the appellant's earlier period, and the demand based on inclusion of the concession was held unsustainable.

---

---

Issues: Whether scholarship-based fee concession granted under a pre-declared coaching scheme constitutes non-monetary consideration requiring inclusion in the taxable value for service tax under the valuation provisions.

Analysis: The scholarship programme was publicly notified in advance and operated as a declared business scheme for attracting students. The taxable value under Section 67 of the Finance Act, 1994 is the gross amount charged, and the appellants were paying tax on the actual amount received from students. The concessional portion of fee granted under the scholarship scheme could not be treated as additional non-monetary consideration so as to invoke the valuation rule. The issue had already been decided in the appellant's own case for an earlier period, and the same reasoning was followed here.

Conclusion: The scholarship concession was not includible in the taxable value, and the demand founded on treating it as non-monetary consideration was unsustainable. The appeal succeeded and the order-in-original was set aside.

---