Service tax on alumni fee rejected where no consideration flowed to the service provider and extended limitation was unsustainable.

Service tax was disputed on an alumni fee collected by a university, but the agreement showed the appellant provided education support and operational assistance, while the fee was collected by the university for alumni-related purposes. On that basis, the fee was not proved to be consideration flowing to the appellant for any taxable service, so it could not form part of taxable value. The extended period of limitation also failed because returns were regularly filed, departmental audits were conducted, and the relevant facts were available to the department, with no suppression or other ground justifying extended limitation.

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Issues: (i) Whether the alumni fee collected by the university could be treated as consideration for services rendered by the appellant and subjected to service tax; and (ii) whether invocation of the extended period of limitation was sustainable.

Issue (i): Whether the alumni fee collected by the university could be treated as consideration for services rendered by the appellant and subjected to service tax.

Analysis: The agreement between the appellant and the university showed that the appellant was engaged in providing education support and related operational assistance, while the alumni fee was collected by the university from students for alumni-related purposes. The service arrangement did not establish that the appellant rendered any alumni service in exchange for that fee. Service tax can arise only where a taxable service is provided for consideration, and the fee collected by the university was not shown to be consideration flowing to the appellant for any such service.

Conclusion: The alumni fee could not be included in the appellant's taxable value, and the demand on that count failed.

Issue (ii): Whether invocation of the extended period of limitation was sustainable.

Analysis: The record showed regular filing of returns and periodic departmental audit, with the relevant facts available to the department. In the absence of suppression of material facts or other circumstances justifying extended limitation, the extended period could not be invoked.

Conclusion: Invocation of the extended period of limitation was not sustainable.

Final Conclusion: The demand was unsustainable both on merits and on limitation, and the assessee obtained full relief.

Ratio Decidendi: Service tax is leviable only on consideration for a service actually rendered, and where the alleged amount is not proved to be such consideration, no tax demand can be sustained; extended limitation cannot be invoked absent suppression of facts.

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