AI Drafter 
TaxTMI 
TaxTMI 
2018 (5) TMI 606
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....tax levy; (ii) that NIMSME have undertaken consultancy and research projects during 2006-07 which would fall within the ambit of Management Consultancy Service and that on the amounts received by them during 2004-05 to 2008-09 for providing such services, they were liable to service tax with interest thereon (iii) that NIMSME were running (i) Kalangan (ii) Musins (iii) Utsav, Vanstahli and Frerena outdoor locations and Amphi-theatre and were lending it to the public for organizing social meetings and social gatherings, which would fall within the category of "Mandap Keeper Services" and "Renting of Immovable Property Services" and that on the amounts collected by appellant on such services during 2004-05 to 2008-09, they were liable to pay service tax with interest. Department thus took the view that the activities of the appellants were liable to service tax under various heads namely "Commercial Training and Coaching Services", "Management Consultancy Services", "Mandap Keeper Services" and "Renting of Immovable Property Services". Accordingly, show cause notices dt. 22.10.2009, 20.10.2010, 22.10.2011, 23.04.2013 and 23.05.2014, 01.04.2015 & 26.04.2016 were issued demanding....
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.... the appellant prays to consider remanding the case for issuing denovo order to grant exclusion of amounts received from Governments for sponsored programmes like grants-in-aid etc., where no fees were collected from the participants and the programmes were conducted only as per orders issued by government from time to time, and for re-determining in the context the actual service tax payable in each appeal matter. 2.2 Ld. Advocate also further extended his above submissions appeal wise as under: I. A PPEAL No. ST/2103/2010 [A rising out of OIO No.23/2010 dated 28-4-2010 passed by the Commissioner of Customs and Central Excise Hyderabad-II Commissionerate, Hyderabad) Sl. No. Service Tax demanded under Period in dispute Amount of Service Tax Demanded Penalty/ Interest 1 Commercial Training and Coaching Services 2004-05 to 2008-09 Rs.2,84,86,402/- i.Rs.3,88,00,000/-u/s.78 of the Finance Act, 1994 ii. Rs. 5,000/-u/s.77 of the Finance Act, 1994 iii. Interest u/s.75 of the Finance Act, 1994. 2 Management Consultant Services 2004-05 to 2008-09 Rs.84,36,616/- 3 Mandap Keeper ....
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....is not leviable to tax in respect of commercial training or coaching service. Hence only the amount of Rs. 75,19,128/-collected from participants in other programmes would be taxable, the tax is Rs. 9,29,364/-. Towards Mandap Keeper services an amount of Rs. 10,47,391/-was collected. The tax is Rs. 1,29,458/-. There was also service of renting of immovable property. The amount collected was R s.2,53,191/-. The tax is Rs. 31,294/-. Total tax payable for the period is Rs. 9,29,364/-. A pre-deposit of Rs. 10 lakhs as already made. III. APPEAL No.ST/28392/2013 [Arising out of OIO No.32/2013 dated 30-8-2013 passed by the Commissioner of Customs and Central Excise Hyderabad-II Commissionerate, Hyderabad) Sl. No. Service Tax demanded under Period in dispute Amount of Service Tax Demanded Penalty/Interest 1 Commercial Training or Coaching Services 2010-2011 & 2011-2012 Rs.2,22,66,166/-& s.2,73,46,630/- i.Rs.200/-or 2% per day u/s.76 and Rs. 200/-per day u/s.77(1)(a) of the Finance Act, 1994. (For period 2010-2011) ii. Rs. 200/-or 2% per day (Rs.100/-or 1% from 8.4.2011) u/s.76 and Rs. 200/-per day u/s.77(1)(a) o....
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....amounts received from Mandap Keeper services is Rs. 6,26,768/-. The tax payable is Rs. 77,469/-. A pre-deposit of Rs. 31,15,000/-was made. There is an excess Rs. 6,52,753/-in balance. V. APPEAL No.ST/30832/2016 [Arising out of OIO No. HYD-SVTAX-000-COM-43-16-17 dated 18-7-2016 passed by the Commissioner of Service Tax, Service Tax Commissionerate, Hyderabad) Sl.No. Service Tax demanded under Period in dispute Amount of Service Tax Demanded Penalty/Interest 1 Commercial Training or Coaching Services 2013-2014 Rs.5,19,58,407/-u/s.73(1) of the Finance Act, 1944 i.Rs.51,95,841/-u/s.76 of the Finance Act, 1944. ii. Rs. 10,000/-u/s.77 of the Finance Act, 1944. iii. Interest u/s.75 of the Finance Act, 1994. 2 Mandap Keeper Services 2013-2014 Rs.1,32,899/-u/s.73(2) of the Finance Act, 1944 SCN OR No.33/2015, Dt.01.04.2015 The period impugned in the notice is 2013-2014. The total amount received as grants was Rs. 40,42,26,185/-. This amount is not taxable. The total fees collected from participants in other programmes is Rs. 1,50,74,042/-. The amount only is taxable to an amount of Rs. 18,63, 152/-. In addition the receipt from Man....
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....them, the amount received from grants-in-aid is not taxable. The appellants have conceded their tax liability under "Commercial Training or Coaching service" in respect of fees collected from participants in other programmes. However, at the same time, they argue that upto 27.02.2010 even the amount received from participants is not liable to tax since by Notification No.24/2004-CE dt. 10.09.2004, the vocational training given for improving skills, although not recognized, is exempted. 5. It has been consistently held by higher appellate forums that there can be no liability to service tax in respect of training programmes conducted on the basis of grants-in-aid received by the institutions set up by the Government for specific objectives. The Tribunal in the case of Apitco Ltd. Vs CST Hyderabad-2010 (20) STR 475 (Tri.-bang.) has set aside the demand of service tax holding that service tax is not leviable on the grants-in-aid received by the assessee from the Central and State Governments given as project implementing agency of the Government. The relevant portions of the Tribunal's order are extracted herein be low:- "3. The assessee, namely M/s. APITCO Ltd., is an org....
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....le service covers the period of dispute in this case. Section 65(92), as this provision stood originally, reads thus: "Scientific or technical consultancy" means any advice, consultancy, or scientific or technical assistance, rendered in any manner either directly or indirectly by a scientist or technocrat or any science or technology institution or organization, to a client, in one or more disciplines of science or technology." The department took the view that, in the implementation of the governmental schemes, the assessee was rendering "scientific or technical consultancy" service to the governments concerned. It is this view which made its way into the show-cause notices and the subsequent proceedings which culminated in the Commissioner's orders. ... .... ..... 6. We have given careful consideration to the submissions. It is not in dispute that the assessee-company had implemented welfare schemes for the Central and State governments for the benefit of the poor or otherwise vulnerable/weaker sections of the society and collected grants-in-aid from the governments concerned. It is not in dispute that these grants-in-aid had been totally utilized for implement....
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....be within the ambit of "scientific or technical consultancy" and hence no service tax could be levied under that category, which view is squarely applicable to the facts of the present case. The view taken by the Tribunal in the above case stood affirmed by the Apex Court in the above case with the dismissal of the department's Civil Appeal filed against the Tribunal's Order. 7. For the reasons noted above, we hold that any amount of service tax is not leviable on the grants-in-aid received by the assessee from the governments, as project-implementing agency of the governments, during the period of dispute. The assessee has also made out a good case on the ground of limitation against a major part of the demand of duty raised in the first show-cause notice. As early as in January 2004, the assessee had furnished all the relevant facts to the department through a letter addressed to the jurisdictional Assistant Commissioner. Later on, in 2006, they stated all these facts once again in a letter addressed to the Superintendent of Service Tax. The show-cause notice in question was issued on 13-6-2006 invoking the first proviso to Section 73(1) of the Finance Act 1994 on the gr....