2026-VIL-1200-CESTAT-DEL-ST
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SERVICE TAX CESTAT Cases

Service Tax on Separately Billed Course Material and Study Material - Appellant, engaged in providing commercial training and coaching services, recovered amounts towards courseware, kits and study material supplied to students and also sold such materials separately to non-enrolled students with separate invoices - Whether service tax is payable on the value of course material sold separately to students including those not enrolled with coaching classes when separate invoices are issued for such materials – HELD - Where the appellant furnishes documentary evidence of separate billing and value for course material, such transaction constitutes a clear transaction of sale of study material and therefore, the value thereof cannot be added in the gross value of taxable coaching services. The Tribunal relies on the precedent set by the Supreme Court in the case of CCE & ST, Indore v. M/s. Cerebral Learning Solutions Pvt. Ltd., which affirmed that Notification No. 12/2003-ST exempts from service tax so much of the value of taxable services as is equal to the value of goods and materials sold by the service provider, subject to documentary proof and conditions in the notification. The appellant sold study materials to non-registered students and the prospectus clearly mentions the price of such materials, thereby establishing separate transactions. Accordingly, the value of separately billed course material, books and study materials is not includible in the taxable value of coaching services - The appeal is allowed - Service Tax on Fee Waiver and Scholarship - Appellant provided fee-waiver and scholarship concessions to certain students undergoing coaching programmes - Dept sought to levy service tax on the gross coaching fees without deducting the scholarship amount - Whether service tax is payable on fee-waiver or scholarship provided to students of the coaching centre when such amount was not charged or collected from the students – HELD - Fee waiver or scholarship granted by the coaching centre to students constitutes a discount or rebate which is not includible in the taxable value of coaching services. The taxable value for service tax purposes is determined by the amount actually charged and collected from the student and not the theoretical gross value. The scholarships or fee waivers granted to meritorious or economically backward students are in the nature of business promotion and cannot increase the taxable value merely because identical services are rendered to all students – The fee waiver or scholarship provided to students does not attract service tax.
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