2011 (7) TMI 571

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..../- along with interest payable under Section 75 of the Finance Act, 1994. Penalty of Rs.1000 under Section 77 and Rs.7,10,06,706/- was also imposed on the appellant under Section 78 of the Finance Act, 1994. 2. Appellants are providing commercial training and coaching service and are registered with Service Tax Department. They carry out part of their operations through third parties under a franchise agreement. All the revenue is collected by the franchises and the same is deposited in Bank account of the appellants. During the course of Audit in December, 2005, it was found that M/s CLIL have shown income as sale of study material but did not pay service tax on it. As per para 2.9.1 of Board's Circular No. 59/8/2003 dated 20.6.2003 exemp....

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....y are entitled for exemption provided under Notification No.12/2003-ST dated 20.3.2003 as they satisfy all the conditions provided therein. They submit that value of books sold by them was separately shown in the invoices issued to students. Appellants further state that activity of sale of goods is subject of State levy and leviable to VAT and under VAT provisions of various States, books are exempted. They also submit that demand is hit by limitation as no extended period can be invoked as there is not suppression of facts. 5. Learned Counsel appearing for the appellants seeks support from Tribunal's Stay Order in Chate Coaching Classes Pvt. Ltd. Vs. Commissioner of Central Excise, Aurangabad - 2008 (9) STR 207 (Tri-Mum) in support of th....

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..... 12/2003 dated 20.6.2003 is being claimed by appellants have no price tag and are integral part of services rendered and study materials are not the text books. These materials are integrated to performance of service of coaching. He submits that question of applicability of exemption under Notification No. 12/2003 has been examined by CESTAT in Final Order No. ST/26-28/11 dated 25.01.2011 in appeal of M/s Sayaji Hotel Ltd., wherein it was held that such contracts are service contracts and no sale is involved in such transaction, therefore, segregation of value made in the invoice as taxable and non-taxable is just a ploy to evade service tax due on rendering of service. He, further, states that adjudicating authority has noted that even t....

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.... the Central Government, being satisfied that it is necessary in the public interest so to do, hereby exempts so much of the value of all the taxable services, as is equal to the value of goods and materials sold by the service provider to the recipient of service, from the service tax leviable thereon under section (66) of the said Act, subject to condition that there is documentary proof specifically indicating the value of the said goods and materials.     2. This notification shall come into force on the 1st day of July, 2003." Appellants claim that they satisfy all the conditions of Notification and are entitled to exemption. 9. We have seen some invoices issued by the appellants to students. Each invoices show Servic....