2025-VIL-728-CESTAT-KOL-ST
  1. Home
  2. 2025-VIL-728-CESTAT-KOL-ST

SERVICE TAX CESTAT Cases

Service Tax – Valuation, Commercial training and coaching services, Hostel fees, Revenue sharing arrangement, Library subscription - Department raised demands on the appellant for non-payment of service tax under various heads - Whether the demand of service tax on hostel fees received for non-residential courses is sustainable - HELD - The stand-alone hostel charges collected for non-residential courses have no connection with commercial training and coaching services. In terms of clarification provided in Circular No DOF/334/1/2007-TRU dated 28.02.2007, residential accommodation such as hostels are specifically exempted from service tax - There should be a nexus between the amount collected and the services rendered. In the present case, the hostel charges for non-residential courses were optional and had no nexus with the commercial training services. Therefore, the demand of service tax on hostel fees for non-residential courses is set aside - The demands of service tax on hostel fees for non-residential courses, share of fees received from CMC Limited, sale of newspapers, magazines, forms, and prospectus, and library subscription, fine, and library development charges, are set aside - The demands on short payment due to accrual accounting, service tax on miscellaneous receipts and reversal of CENVAT credit is upheld. The penalty imposed are also set aside – The appeal is partly allowed - Whether the demand of service tax on the share of fees received from CMC Limited under Business Support Services is sustainable - HELD - The agreement between the appellant and CMC Limited was a revenue sharing arrangement on a principal-to-principal basis, and there was no service provider-service recipient relationship. Relying on the decisions in Inox Leisure Ltd. Vs Commissioner of Service Tax, Hyderabad and the CBEC Circular No 109/3/2009-ST, the Tribunal held that in such revenue sharing arrangements where the parties act on a principal-to-principal basis, the activities are not covered under service tax. Accordingly, the Tribunal set aside the demand of service tax on the share of fees received from CMC Limited - Whether the demand of service tax on sale of newspapers, magazines, and forms/prospectus is sustainable - HELD - The sale of newspapers, magazines, forms, and prospectus are tantamount to sale of goods, which is not leviable to service tax. The Tribunal relied on the decision in Aditya College of Competitive Exam Vs C.C.E., Vishakhapatnam, which held that there should be a nexus between the amount collected and the services rendered. In the present case, the sale of these items had no nexus with the commercial training services provided by the appellant. Therefore, the Tribunal set aside the demand of service tax on the sale of these items - Whether the demand of service tax on library subscription, fine, and library development charges is sustainable - HELD - The library membership and charges collected by the appellant are not towards providing any commercial training or coaching services under section 65(105)(zzc) of the Finance Act or under any taxable service liable to service tax till 01.07.2012. The library services provided by the appellant were optional and had no nexus with the commercial training services. Therefore, the Tribunal set aside the demand of service tax on the library subscription, fine, and library development charges.
Download File

Quick Search

/

Advance Search

GST Resources

/

Gst Rate Finder

Tax Vista

Your Biweekly Tax Recap

By Dr. G. Gokul Kishore

Weekly Summary

VIL Video

Credit Notes ITC Reversal in IMS…
By Vivek Jalan

Create Account

Security-Code
New Code?

Log In

New User ? Forgot Password ?

Forgot Password

Security-Code
New Code?
Please Note: This facility is only for Subscribing Members.

Email this page

Feedback this page

Schedule a Demo

Schedule a demo to know the features and advantages of VILGST portal. Get to know the tips to find the desired results in faster way.

Caselaw Request Form (CRF)

Didn’t find what you are searching for? No worries, please give us the following details and VIL will email you the desired Caselaws at the earliest:

Security-Code
New Code?