TaxTMI 
TaxTMI 
2009 (1) TMI 65
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.... Not quantified Thanjai Study Centre S/40/06 39,645 Rs. 100. per day not exceeding Rs. 40,438 Rs. 1,000 Not quantified Trichy Institute of Management Studies (P.) Ltd. 5/35/07 4,29,119 3,79,000 1000 4,29,000 500 - 2. The appellants are engaged in coaching of students desirous of taking examinations conducted by the Alagappa University. The students are taught the various subjects as per the syllabus prescribed by the University for each course. On successful completion of the respective courses, the students are awarded B.A., B.Sc., B.Com., M.A., M.B.A. etc. The centres involved are two of above 200 such centres functioning across the country which have entered into a Memorandum of Understanding (MOU) with the Alagappa University for preparing students to take examinations conducted by the University. Suitable faculty and other facilities are provided at the centres. The University participates in the recruitment of the faculty. Centres are provided study material by the University. Attendance of the students is recorded by the centres and the same is one of th....
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....m payment of service tax up to an aggregate value of Rs. four lakhs of all taxable services rendered in a financial year. 4. Heard both sides. 5. I have carefully studied the case records and considered the submissions by both sides. The centres in question render the same service as regular colleges affiliated to the University. The lower appellate authority denied the exemption contained in Notification No.10/2003-ST to the appellants enjoyed by a large number of regular colleges similarly placed as the centers qua the conditions of the above notification. Notification No. 10/2003-ST reads as follows- In exercise of the powers conferred by section 93 of the Finance Act, 1994 (32 of 1994), the Central Government, being satisfied that it is necessary in the public interest so to do, hereby exempts the taxable services provided by a commercial training or coaching centre, in relation to commercial training or coaching, which form an essential part of a course or curriculum of any other institute or establishment, leading to issuance of any certificate or diploma or degree or educational qualification recognized by law for the time being in force, to any person, from t....
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....s. They cater to an important need of the citizen to receive higher education which the State is not able to provide. Taxing them amounts to discrimination if the regular colleges are commercial training or coaching centres like the appellants. 6.2 The Hon'ble High Court of Kerala found in the case of Malappuram District Parallel College Association (supra), as follows "..........As already the parallel colleges are students who are entitled to write the University examinations as private students. The curriculam prescribed for the examination and the degree certificate awarded to private students and students studying in regular colleges, whether aided or self-financed affiliated to University, are the same. Therefore there is no distinction between the two classes of students namely, the students studying in the colleges affiliated to Universities and private students who take coaching in parallel colleges to write the same examinations. While the students studying in affiliated colleges cannot be subjected to service tax along with tuition fees and other fees levied by the management of those colleges, students who are studying in parallel colleges will have to bear the se....
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....e undergoing study in affiliated colleges whether aided or self-financed in the same subjects for writing the same examinations. Therefore levy of service tax for services rendered by parallel colleges which indirectly falls on the students, but by simultaneously providing exemption to regular affiliated colleges allowing the students therein study free of tax is patently discriminatory and violative of article 14 of the Constitution of India? (p. 94) The Hon'ble High Court thus vacated the demand of service tax on them. Their Lordships had clarified that the above judgment was rendered on the peculiar facts applicable to parallel colleges in Kerala and advised that the same was not to be treated as declaring the section unconstitutional, insofar as any other category of educational institution or training centre was concerned. 7. I find that the judgment of the Hon'ble High Court of Kerala was made on the facts of that case and was not to be followed as a precedent. Exemption under Notification No. 10/03 ST is extended to commercial training and coaching centres that give tuition to the students who receive University degrees on passing the end of the course examination and ....