Applicability of service tax

[Guest]

I am working in IIFM Bhopal.Our Institute is an educational institute, which provides diploma in the area of forestry.Our institute is also conducting management development programmes,workshops ,seminars etc, which are sponsored/ fee based, and for it a certificate is also issued to participants.Some time on the instructions of govrnment of india programmes are conducted and payment ois made by the government.IFM is paying service tax on the consultancy projects, during a case assistant comm. bhopal has pased an ordr that the management development programmes being conducted by IIFM are also part of consultancy and IIFM should deposit service tax on it.Please advice quoting any decision made earlier.

[Surender Gupta]

As per the provisions of the statute, in case you are providing any course which is recognized by law is exempt. Moreover, any additional course you provide which is not recognized shall also be exempt. But there is exemption to management consultancy services and other service as such.

[Madhukar N Hiregange]

In service tax the services provider is defined. For example the services of accounting done by a non CA was earlier not liable ( from 1998- 2004/5)In your case the service provider who issues a diploma/ degree is not at all a service provider. Therefore you can have no liability for any other course. Seocndly calling the MDP course as consultancy only indicates the lack of knowledge of the officer which should be stoutly defended. Thridly I understand from the background that you may not be acommercial venture. Then the entire coaching and training would not be liable. Recently the Tribunal has passed a simlar order. As of now I cannot recall.

AI Summary

Service tax on educational programmes: recognized courses and non commercial training may fall outside taxable services under the tax regime. Applicability of service tax arises where an institute conducts diploma courses, MDPs, workshops or seminars. Courses 'recognized by law' are exempt and provision of recognised diplomas is treated as outside taxable services. The definition of service provider controls liability: if the institute's activities fall within educational or non commercial training exemptions, they are not taxable; mere officer classification of MDPs as consultancy does not itself establish liability.