2026-VIL-1118-CESTAT-DEL-ST
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SERVICE TAX CESTAT Cases

Service Tax - Interpretation of exemption notification - Scope of "culture" in recreational activities exemption - Appellant, a coaching institute providing training in astronomy, claimed exemption from service tax under Entry 8 of Notification No. 25/2012, which exempts "services by way of training or coaching in recreational activities relating to arts, culture, or sports." The appellant contended that astronomy constitutes part of Indian culture and therefore qualifies for exemption - Department issued notice proposing a demand of service tax, contending that astronomy is a pure science and not covered under the exemption notification - Whether services of providing training and coaching in astronomy fall within the scope of "culture" as mentioned in Entry 8 of the exemption notification and are therefore exempt from service tax – HELD – It is well-established principle that exemption notifications must be interpreted strictly and the burden of proving applicability lies on the assessee. The term "culture" in the context of recreational activities refers to dance, music, theatre, literature, and similar traditional art forms. Applying the doctrine of noscitur a sociis, which provides that the meaning of a doubtful word may be ascertained by reference to associated words, the term "culture" must be interpreted narrowly in light of the preceding term "art" used in the notification. Science, including astronomy, is distinguishable from culture and art. Although astronomy may have been integral to Indian civilization historically, the specific terminology used in the Notification cannot be stretched to encompass scientific activities. The CBEC clarification supporting the limited scope of the exemption to traditional art forms like dance, music, painting, sculpture, theatre, and sports reinforces this interpretation - The appeal is dismissed on merits, with the impugned order affirmed. However, the matter is remanded to the adjudicating authority for the limited purpose of recalculation to provide the benefit of cum-tax to the appellant in accordance with section 67(2) of the Finance Act, 1994 – The appeal is dismissed
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