Computer training exemption from service tax continued until 15-6-2005, so demand for the earlier period failed.

Computer training was treated as exempt from service tax under the commercial coaching or training category for the period before 15-6-2005. The Tribunal followed its earlier view that taxability arose only from that date, when Notification No. 19/2005-ST took effect, and therefore service tax could not be sustained for the exempt period. The demand covering 10-9-2004 to 15-6-2005 was thus held unsupportable, with the issue decided in favour of the assessee.

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Issues: Whether computer training was exempt from service tax under the category of commercial coaching or training for the period from 10-9-2004 to 15-6-2005.

Analysis: The Tribunal followed its earlier view that computer training remained exempt under the relevant taxable service category until 15-6-2005 and became taxable only from that date by virtue of Notification No. 19/2005-ST dated 7-6-2005. Since the demand related to the exempt period, service tax could not be sustained for that span.

Conclusion: The issue was decided in favour of the assessee.

Ratio Decidendi: Service tax cannot be demanded for a period during which the activity remained exempt, and taxability begins only from the effective date of the amendment making the service taxable.

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