Educational exemption for recognised university courses bars service tax, extended limitation, and penalty where facts are already known.

A post graduate diploma run by a private university under the Haryana Private Universities Act, with State Government authorisation to start the course, was treated as education forming part of a curriculum for obtaining a qualification recognised by law. On that basis, service tax was held not payable on the course fees and the educational exemption under Notification No. 25/2012-Service Tax was available. The demand also failed on limitation because the relevant facts were already within the department's knowledge and the record did not support suppression, so the extended period could not be invoked. With no tax liability, the penalty also could not survive.

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Issues: (i) Whether service tax was payable on the fees charged for the Post Graduate Diploma in Liberal Studies and whether the course fell within the expression "education as a part of curriculum for obtaining a qualification recognized by any law for the time being in force". (ii) Whether the appellant was entitled to exemption under Sr. No. 9(a) of Notification No. 25/2012-Service Tax and whether the extended period and penalty could be sustained.

Issue (i): Whether service tax was payable on the fees charged for the Post Graduate Diploma in Liberal Studies and whether the course fell within the expression "education as a part of curriculum for obtaining a qualification recognized by any law for the time being in force".

Analysis: The course was conducted by a private university established under the Haryana Private Universities Act, 2006, and the record showed authorization from the State Government to start the course. The UGC material relied upon also reflected the course as being run by the university, while the UGC itself did not prescribe diploma or certificate courses under the cited framework. On the facts found, the course was held to be one authorised by the competent statutory authority and therefore to satisfy the requirement of education forming part of a curriculum for obtaining a qualification recognised by law.

Conclusion: The course was treated as recognised by law and service tax was not payable on that ground.

Issue (ii): Whether the appellant was entitled to exemption under Sr. No. 9(a) of Notification No. 25/2012-Service Tax and whether the extended period and penalty could be sustained.

Analysis: Once the course was held to be recognised by the competent State regulatory framework, the appellant fell within the exemption available to an educational institution providing education as part of a recognised curriculum. The facts were also found to be within the department's knowledge, the demand was based on the appellant's records, and there was no basis to invoke suppression for extending limitation. In the absence of any payable tax, penalty could not survive.

Conclusion: The appellant was entitled to the exemption, the extended period was not invokable, and the penalty was unsustainable.

Final Conclusion: The demand of service tax, interest, and penalty was set aside and the appeal was allowed with consequential relief.

Ratio Decidendi: Where a university establishes that a course is authorised by the competent statutory authority and satisfies the legal requirement of a recognised curriculum, the educational exemption applies; if the department already has the material facts, the extended period and related penalty cannot be sustained.

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