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

Institute Challenges Service Tax on Management Programs, Citing Legal Exemption and Non-Commercial Status An educational institute offering diplomas in forestry and conducting management development programs (MDPs) sought advice on the applicability of service tax to these programs. An assistant commissioner ruled that MDPs should be taxed as consultancy services. Respondents argued that courses recognized by law are exempt from service tax, and the institute, not being a commercial venture, should not be liable for service tax on MDPs. They suggested that the classification of MDPs as consultancy services reflects a misunderstanding and noted a similar tribunal decision supporting non-liability for such educational services.