TaxTMI 
TaxTMI 
2025 (4) TMI 1734
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....ing out their campus premises to Banks, Post Offices, Cafeteria, Shops etc. Show Cause Notice [SCN] dated 29.06.2018 was issued for the period from October, 2012 to June, 2017 proposing to demand service tax amounting to Rs. 3,02,17,412/- alongwith applicable interest and to impose penalties under various Sections. The Appellant is running as an Affiliating State University, Several Degree/P.G. Colleges (Government, aided and non aided private colleges) of specified 12 districts (earlier it was 15) of Uttar Pradesh are affiliated with the University as per University Rules. Affiliation fee for colleges and affiliation fee for each additional subject is charged from the colleges as prescribed under rules notified by the Governor, as per rates prescribed by the State Government. For facilitation of staffs and the students etc., the University has provided space to Union Bank of India and Bank of Baroda on rental basis. Spaces for Canteen, Coffee Shop, Computer typing & Photo copying etc., and Post Office were also provided on rent to different parties. The Appellant also maintains one International Guest House for University's guests from whom highly subsidized rent is charged for st....
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....se, Madurai [2021] 130 taxmann.com 165 (Madras) the Hon'ble High Court of Madras has held as under:- "11. After having gone into these arguments and the connected records, this Court feels that, the only question posed before this Court for decision is that, whether the services rendered by the petitioner university by granting affiliation and its allied activities and also by providing shelter in their campus to the service providers like Bank, Post Office, or catering etc., directly beneficial to the students, staff and faculty of the university, are exempted services within the meaning of Section 66D of the Finance Act and also under the Mega Exemption Notification of the year 2012 as amended from time to time. 12. The history of introduction of service tax has been traced by the Learned Counsel for the petitioner, which has been discussed in the earlier paragraphs. Up to 2012, the term "service" seems to have not been explained. First time, the term "service" has been explained under Clause (44) of Section 65B, which has already been quoted hereinabove. 13. While giving such explanation for the term "service", the legislature also thought it fit to in....
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.... effect from 11-7-2014, where, the services provided by the educational institution to its students, faculty and staff are mentioned. The word "students", that we can understand, with, the services provided, is nothing but imparting education, whereas, the services to be provided by the educational institution to its faculty and staff is concerned, certainly, it may not be a direct activity of imparting education. No staff or faculty is going to get any imparting of education either from the institution or from the university. Hence, it is not limited to the services of imparting education to students alone for the purpose of exemption, but, it expands beyond which, where, whatever the services to be provided by the educational institution to its faculty and staff shall also form part of the activity of education being provided by way of services by the educational institution. If we take up this language used, exactly, the services provided by the educational institutions including the university not only for students but also for faculty and staff would be covered under the exempted purview. 18. Not stopping with that, it goes further saying that, an educational institut....
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....affiliation can be an integral part of the educational services, being provided jointly, both by the University and the college. The college cannot independently function without the affiliation of the university. Therefore, for the purpose of providing the services of education, both the university as well as the college concerned, who get affiliated to the university, cannot be separated. 20. This is the purposive interpretation which is only possible, because, the services relating to admission and also the conduct of examination by such institution has been exempted. When we talk about the conducting of examination, it is the vehement contention of the revenue as submitted by the Learned Standing Counsel by relying upon the advance ruling referred to above, stating that, exempted service on the conduct of examination is that, it relates to admission to institution and anything related to examination, based on which, degree, title or diploma is conferred to the students. 21. With respect, this Court is of the concerned view that, that kind of narrow or pedantic interpretation cannot be possible in the words "conduct of examination". The reason being, the very p....
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....ot denote only the college affiliated to the university, but, it includes the university. As stated above, without the university, college cannot impart education on its own. 23. Moreover, the regime of service tax, i.e., prior to the GST came into the field, had continuously made available the exemption provisions, initially by Section 66D, from 2012, subsequently the mega notification, wherein, in the year 2014 clause (9) was inserted and subsequently by Notification No. 9/2016, Clause (l) of Section 66D, which was omitted from the year 2016, had been reintroduced by introduction of clause (oa), where, under the heading "educational institution", the exact Clause (l) of Section 66D has been inserted. Therefore, throughout the regime between 2012 and 2017, the educational institution had been provided with the exemption as has been stated in various provisions of the Act as well as the mega notification, followed by the amended notification and during all these periods, these institutions including the universities can very well enjoy the exemption. Accordingly, the stand taken by the revenue for levying service tax for the services being provided by the petitioner univer....
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....any service tax for the services of education provided by them, which includes affiliation or other services provided for the students, faculty as well as the staff of the university. Therefore, in all respect, the impugned order shall not stand in the legal scrutiny. 27. Accordingly, the impugned order is set aside and the writ petition is allowed. However, there shall be no order as to costs. Consequently, the connected miscellaneous petition is closed." 7. In the case of Rajiv Gandhi University of Health Sciences vs. Principal Additional Director General, Directorate General of GST Intelligence [2022] 141 taxmann.com 206 (Karnataka) the Hon'ble High Court of Karnataka has held thus:- "8. The petitioner-University is established under the Karnataka State Universities Act, 2000 and Universities are established by the State for furthering the advancement of learning and pursuing of higher education and research. For this purpose, apart from they themselves imparting education through their constituent colleges, it also admits educational Institutions not maintained by the University as affiliated colleges and in the process regulates the manner in which educati....
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....rovision of one service is combined with an element or elements of provision of any other service or services." 14. It is not in dispute that petitioner has let out some of its buildings for canteen, Bank and other facilities which are essential for effective running of an University in furtherance to imparting education and the said activity has to be considered as an activity incidental to provide services of education and it is a service naturally bundled in the ordinary course of business as contemplated in the aforementioned Clause (3) of Section 66F of the Act and the rent received also deserves to be exempted once the activity of providing education by the petitioner-Institution is exempted from service tax. 15. The only question that arises for consideration is whether the petitioner is liable to pay the service tax on the rent received by it from the buildings let out by it. 16. Normally, a person is bound to reply to the show cause notice issued by the Authority and it is not appropriate for him to approach the Court without doing the same. However, in the instant case, the dispute does not pertain to quantification of service tax, but whether t....
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....lleges are clearly covered by the exemption notification. The activity of the Goa University in collecting the ailiation fees is exempt from GST and hence the fees collected by Goa University is not liable to tax. 48. The Goa University is actively involved in imparting education to students and it acts as a regulator of education. Section 24 of the Goa University Act specifically empowers university to pass 'ordinance' for the admission of students to the University and their enrolment, fee to be charged for admission and examination. It is on the basis of the ailiation that is granted by the University that the ailiated colleges conduct courses, conduct examinations and also award the degree to the students admitted to secondary education. The term 'education, in our opinion, and as rightly submitted by the learned Senior Advocate for the petitioner University, should not be restricted to the activity of teaching/providing instruction to students inside a classroom, rather it is a wider term which would involve the activity of designing the curriculum for the course of study which would be used by constituent colleges, giving ailiation to colleges so that the....