TaxTMI 
TaxTMI 
TaxTMI 
2025 (5) TMI 1916
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.....2014, the appellants have been collecting an amount in the name of hostel fees. The activity of providing accommodation is taxable activity but the appellants were found to have not deposited the tax. Accordingly, vide show cause notice No. 103/2018 dated 16.10.2018, service tax amounting to Rs. 14,86,475/- was proposed to be recovered along with the proportionate interest and appropriate penalties. While adjudication, the original authority has dropped the entire demand holding as follows:- "11.6. In view of the above, I find that the services provided by the educational institute to its students, faculty or staff as hostel fall under the negative list of services defined under section 66D (m) of the Finance Act, 1994 and no service is ....
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....as not paying any Service Tax thereon. Otherwise also such education services were covered under negative list of services under Section 66D(1) of the Act during the relevant period. 3.1 It is submitted that the issue involved in the present appeal stands already decided in favour of the appellant and the decision in the case of Modi Education Foundation vs. Commissioner of Central Excise, Jodhur reported as 2023 (5) TMI 609 - CESTAT NEW DELHI and Rajiv Gandhi University of Health Sciences, Karnataka vs. Principal ADG, Bengaluru Zonal Unit, reported as 2022 (8) TMI 707-Karnataka High Court. The appeal is accordingly prayed to be allowed by setting aside the Order-in-Appeal/impugned order. 3.2 While rebutting the submissions, learned DR at....
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....has dealt with the facts with respect to the boarding school receiving hostel fees from the students in addition to the tuition fees and the other charges. The perusal reveals that the issues are identical in the said decision. While adjudication, this Tribunal has considered the another issue as to whether the two services, namely, hostel services and the education services are naturally bundled in the ordinary court of the business and while doing so, it has been held as follows:- "18. A perusal of the aforesaid provisions of Section 66F of the Finance Act would indicate that if there are various elements of service which are naturally bundled in the ordinary course of business, the taxability of such bundled services shall be based on ....
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....roduced below : "4.12.4 Are services provided by boarding schools covered in this entry? Boarding schools provide service of education coupled with other services like providing dwelling units for residence and food. This may be a case of bundled services if the charges for education and lodging and boarding are inseparable. Their taxability will be determined in terms of the principles laid down in section 66F of the Act. Such services in the case of boarding schools are bundled in the ordinary course of business. Therefore the bundle of services will be treated as consisting entirely of such service which determines the dominant nature of such a bundle. In this case since dominant nature is determined by the service of education othe....
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....eading to a qualification recognised by law, are fully exempt from GST. Annual subscription/fees charged as lodging/boarding charges by such educational institutions from its students for hostel accommodation shall not attract GST." 23. What, therefore, follows from the aforesaid discussion is that the hostel service and education services are naturally bundled in the ordinary course of business and it is the education service that gives the essential character to such bundle. Education services by way of pre-school education and education up to higher secondary school or equivalent are enumerated in the negative list of services enumerated in Section 66D of the Finance Act. Thus, it cannot be subjected to levy of service tax. 24. In th....