TaxTMI 
TaxTMI 
2024 (7) TMI 687
X X X X Extracts X X X X
X X X X Extracts X X X X
....fic & Technical Consultancy, Commercial Training & Coaching and Work Contract Service along with other services as a non- profit organization, to work as an international centre of excellence in horticulture. Their objective was to equip the grower trainees with practical skills and innovative technological inputs in order to improve the quantum and quality of marketable produce. An inquiry was initiated against the appellant on the grounds that they were not paying service tax on the services being provided by them. During the inquiry, the statement of Dr. Sangita Ladha, Director of the appellant was recorded on 17th January 2012 wherein she stated that their centre was registered as a Society and was involved in imparting training to various clients, including Horticulture Officers of the State Agriculture & Horticulture Department and other Government Bodies, Scientists, Students, farmers etc., and in research related to horticulture and its related activities. They had obtained Service tax Registration under Commercial Training and Coaching, Scientific and Technical Consultancy and Works Contract Services. However, they were paying service tax on Works Contract Service only, on....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ellant has filed appeal before this Tribunal. 3. The Learned Counsel for the appellant submitted that the impugned order has confirmed the demand of service tax of Rs.42,00,910/- on the total value of Rs. 4,02,05,286/- with respect to the training imparted by the Appellant under the category of "Commercial Training or Coaching Services" and the same has been confirmed without taking into account the correct nature of receipts. From perusal of the receipts, he submitted that it was evident that out of total receipts of Rs.4,02,05,286/-, receipt only to the extent of Rs. 3,67,81,896/- was towards the actual training of various personnel. Hence, the remaining amount is not taxable under the category of 'Commercial Training or Coaching Services'. Further, the learned Counsel submitted that the demand of service tax on Rs. 3,67,81,896/- was not sustainable as the 'Training services' provided by a vocational training institute were exempt till 26.2.2010. He drew attention to Notification No. 24/2004-ST dated 10.9.2004 whereas an exemption was provided to 'Commercial Training or Coaching Services provided by a vocational/recreational training institute. The said notificatio....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ffirmed vide [2011 (23) STR J94 (SC)]; (iii) ILFS Clusters Development Initiative Ltd. vs. Commissioner, Customs, Central Excise & Service Tax, Noida, [2018 (10) TMI 1007-CESTAT ALLAHABAD]; (iv) Centre for Research & Industrial Staff Performance vs. CGST, Bhopal, 2019 (22) GSTL 385 (Tri. - Del.)]; (v) Madhya Pradesh Consultancy Organisation Ltd. v. C.C.E., Bhopal, [2017 (4) G.S.T.L. 100 (Tri. - Del.)] In view of the above submissions, he contended that the demand of service tax confirmed under the category of 'Commercial Training or Coaching Services' was not sustainable. 3.3 The learned counsel further submitted that the impugned order has confirmed the demand of service tax of Rs. 25,34,202/- with respect to the execution of greenhouse projects and other projects under the category of 'Works Contract Services' after denying the benefit of Composition Scheme availed by the Appellant. The impugned order had denied such benefit on the ground that neither the actual value of goods was provided by the appellant nor an advance intimation about opting for the composition scheme. In this regard, he submitted that the impugned order had accepte....
X X X X Extracts X X X X
X X X X Extracts X X X X
....39;, the immovable property is let out for organizing any official, social or business function. In the present case, the property was let out by the Appellant was for conducting the seminars on horticulture which is for the educational/academic purpose. Thus, the same falls outside the purview of 'mandap keeper services'. 3.5 The learned Counsel further contended that the impugned order has confirmed the demand of service tax of Rs. 21,73,714/- on the foreign remittances made by the Appellant to M/s. Stitching PTC Netherlands for providing training to the trainers/managers sent by the Appellant to Netherlands, under the category of 'Commercial Training or Coaching Services'. He contended that there is a computational error in the taxable value taken i.e. instead of Rs. 2,46,536/-, the value has been taken as Rs.24,65,336/-. Further, the impugned order had demanded service tax under this category in terms of Section 66A of the Finance Act i.e. import of services. In this regard, he drew attention to Taxation of Services (Provided from Outside India and received in India) Rules, 2006 ("Import of Service Rules") which bifurcates all the services into three different categories....
X X X X Extracts X X X X
X X X X Extracts X X X X
....titution or organization, is not taxable under the category of 'Scientific or Technical Consultancy Services'. a) Administrative Staff College of India vs. CC & CE, Hyderabad, 2009 (14) STR 341 (Tri.Bang.), maintained by Supreme Court vide [2010 (20) STR J117 (S.C.)]; b) Maruti Suzuki India Limited vs. CCE, Delhi, [2019 (21) GSTL 24 (Tri. - Chan.)]; and c) Jai Research Foundation vs, CCE & ST, Vapi, 2019 (25) GSTL 473 (Tri. - Ahmd.) 3.7. On the issue of demand of service tax on the operational expenses received from M/s. DCM Shriram Consolidated Limited the Impugned Order has confirmed the demand of service tax of Rs.22,24,800/- on the operational expenses of the Appellant incurred by M/s. DCM Shriram Consolidated Limited under the category of 'Scientific or Technical Consultancy Services', the ld counsel submitted that the entire basis of such demand in both the SCN as well as Impugned Order is the selective reliance on one of the clauses of the Memorandum of Understanding (MoU) entered between the Appellant and M/s. DCM Shriram Consolidated Limited. He submitted that from the MoU itself, it is evident that M/s. DCM Shriram Consolidate....
X X X X Extracts X X X X
X X X X Extracts X X X X
....rious amounts on account of Works Contract Services provided / to be provided but have neither provided the actual value of transfer of property in goods involved in execution of works contract nor opted for the Composition Scheme. The provisions of Rule 3(3) of the Composition Rules, 2007 has to be read under the presumption that option has been exercised before the due date of payment of service tax. Once the due date of payment of service tax is crossed, the right to exercise the option under Rule 3(3) of said rules lapses. iii) On the issue of non-payment of service tax under Mandap Keeper Service, the learned AR submitted that the appellant had argued that the premises was provided on rent not to earn profit but for organisation of seminars to enhance the horticulture activity, but the Adjudicating Authority had held that there was no exemption under any notification regarding providing of premises on rent for organisation of seminars to enhance the horticulture activity and furtherance of agriculture. Therefore, the activity of appellant for allowing their premises for seminar or other function to the clients on consideration is classifiable under Mandap Keeper, hence is t....
X X X X Extracts X X X X
X X X X Extracts X X X X
....y have provided the details of taxable amount of the said services received and rendered only after initiated enquiry/ called for by the department. They have neither shown gross taxable value received by them for providing taxable services in their prescribed ST-3 returns in due manner as provided in law. Had the department not initiated the inquiry against the appellant, the fact of evasion of service tax would not have come into the knowledge of department. Hence the appellant has wilfully suppressed the facts of providing taxable service and non-payment of service tax thereon from the department thereby contravened the provisions of Section 66, 67 and 68 of the Finance Act, 1994. Keeping in view all the facts, impugned order is prayed to be upheld and appeal to be dismissed. 5. Heard both the sides and taken into consideration the submissions made. The issues before us for consideration are as follows: (i) Liability of service tax on trainings imparted by the appellant under the head Commercial training or Coaching service; (ii) Eligibility of composition scheme under Works Contract Service (iii) Service Tax on Mandap Keeper services (iv) ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ule 5(1) of the Rules runs counter and is repugnant to Sections 66 and 67 of the Finance Act and held it to be ultra vires. Further, with respect to the receipt of Rs.20,00,000/ given as grant-in-aid by the National Mission for medicinal plants, we observe that this issue stands decided by the Supreme Court in the case of Commissioner vs Apitco Ltd [2011(23)STR J94(SC)], wherein it upheld the Tribunal's order that grant-in-aid received from the Government for implementation of schemes were fully utilised for the said activity and no consideration was received for any service to the government, was not taxable. We find that in the instant case, the grant-in-aid had been received from the government for the scheme and is therefore squarely covered by the aforesaid decision. 6.2 We now address the arguments of the ld counsel and ld AR regarding the confirmation of demand of the training/coaching services provided by the appellant. The ld counsel for the appellant has submitted that Training services provided by a vocational training institute were exempt till 26.2.2010. In this regard, it would be appropriate to reproduce the provisions hereinafter to appreciate the submissions. ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... trades as notified under the Apprentices Act, 1961(52 of 1961)." Therefore, during the intervening period i.e., 10.09.2004 to 26.2.2010, the scope of the exemption was for all such centres providing vocational training/coaching that impart skills to the trainee. It was submitted by the learned counsel for the appellant that the amendment by Notification No. 3/2010-ST dated 27.2.2010 was prospective in nature & did not have any retrospective effect. We find that in the impugned order, the adjudicating authority has applied the amended definition of vocational training institute for the period prior to the said amendment. We note that in a similar issue in case of Canan School of Catering of Hotel Management [2019 (22) GSTL 61 (Tri. Chennai)], the Tribunal observed as under:- "6. The only dispute is applicability of the Notification No. 9/2003, as amended. We note that the original authority examined the scope of exemption in the context of amendment carried out in 2010. In 2010 amendment statutorily changed the scope of exemption, restricting the same specifically to the work and trade as recognized by the Apprentice Act, 1961. We note that the present dispute relates t....
X X X X Extracts X X X X
X X X X Extracts X X X X
...., we are of the view that as long as there is the ability to seek employment or self-employment in terms of the explanation of the notification supra, the benefit of exemption cannot be denied, as has been held by this Tribunal in the case of M/s Frankfinn Aviation Services Pvt Ltd., vs Commissioner of Service Tax, New Delhi reported in 2017 (5) GSTL 154 (Tri. Del). Consequently, we hold that the appellant is entitled to the exemption for the period prior to the amendment dated 27.02.2010. As regards the demand for the subsequent period, we hold that the same would be taxable. However, the demand would be restricted to the normal period only. 7. Works Contract Service: We now take up the second issue for consideration. The impugned order has confirmed the demand of service tax of Rs. 25,34,202/- with respect to the execution of greenhouse projects and other projects under the category of 'Works Contract Services' after denying the benefit of Composition Scheme availed by the Appellant. We find that the impugned order has not denied that the appellant had rendered 'Works Contract Service'. The dispute pertains limitedly in respect of the extension of benefit of th....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ansfer of Property Act, 1882 and includes any furniture, fixtures, light fittings and floor coverings therein let out for a consideration for organizing any official, social or business function. Explanation. For the purposes of this clause, social function includes marriage; Section 65(67) "mandap keeper" means a person who allows temporary occupation of a mandap for a consideration for organizing any official, social or business function. Explanation; For the purposes of this clause, social function includes marriage. Section 65(105) "taxable service" means any service provided or to be provided, - (m) to any person, by a mandap keeper in relation to the use of mandap in any manner including the facilities provided or to be provided to such person in relation to such use and also the services, if any, provided or to be provided as a caterer;" From the above provisions, it is clear that for any service to be taxable under 'mandap keeper service', the immovable property has to be let out for organizing any official, social or business function. In the present case, it has been submitted before us that the property was let out by the Appellant ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....A of the Act, the taxable services provided from outside India and received in India shall, in relation to taxable services- (i) specified in sub-clauses (d), (m), (p), (q), (v), (zzq), (zzza), (zzzb), (zzzc), (zzzh), (zzzr), (zzzy), (zzzz), (zzza), (zzzzm), (zzzzu), (zzzzv) and (zzzzw) of clause (105) of section 65 of the Act, be such services as are provided or to be provided in relation to an immovable property situated in India; (ii) specified in sub-clauses (a), (f). (h), (i), (f). (1). (n). (o), (vw), (2), (zb), (c), (zi), (zj), (zn), (zo), (zq), (zr), (zt), (zu), (zv), (zw), (zz), (zza), (zze). (zzd), (zzf). (zzg). (zzi), (zzl), (zzm), (zzo), (zzt), (zzv), (zzw), (zzx). (zzy), (zzzd), (zzze), (zzzf), (zzzzg). (zzzzh), (zzzzi), (zzzzk), (zzzzl) and (zzzzo) of clause (105) of section 65 of the Act, be such services as are performed in India:] Provided that where such taxable service is partly performed in India, it shall be treated as performed in India and the value of such taxable service shall be determined under section 67 of the Act and the rules made thereunder: Provided further that where the taxable services referred to in sub- claus....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... held that the services were performed outside India, and the payments were reimbursements of the expenses, hence there was no liability of tax. 9.3 However, as regards the remaining two trainings, it is not clear whether the said two trainings were also conducted at Netherlands, which would then not be liable to tax or whether they were conducted in India, as such training conducted in India would then be liable to tax. This aspect would have to be verified by the original authority and therefore, we remand this issue to the adjudicating authority to examine whether the same were provided in India or Netherlands, and decide the matter. 10. Liability of service tax on Scientific & Technical Consultancy received by the appellant: We note that the impugned order has confirmed the demand of service tax of Rs. 5,38,952/- with respect to the activity of design of business & master plan undertaken by M/s. Stitching PTC Netherlands for the Appellant under the category of 'Scientific or Technical Consultancy Services'. The relevant provisions with respect to 'Scientific or Technical Consultancy Services are extracted as under:- "Section 65(92) "scientific or tech....