1. This appeal is filed by the revenue against sanction of refund claim by Commissioner (Appeals). Aggrieved by the said order, revenue is before the Tribunal.
2. Ld. AR for the revenue argued that Commissioner (Appeals) has gone beyond the scope of issue by deciding the service classification of the assessee without adducing evidence. He argued that the respondent had themselves registered under Commercial Training & Coaching Services. However, subsequently they sought to change the classification of the service to Business Auxiliary Service. The respondent claimed exemption notification No. 14/2004-S.T. dated 10.09.2004 based on a clarification letter dated Joint Secretary (TRU-III) to Joint Secretary (Rural Department) vide DO letter No. 34/164/2011-TRU dated 26.07.2011. In the said letter it had been clarified that training under centrally sponsored schemes are exempted.
3. Ld. AR however, pointed out that there is a specific clarification issued by Director (Service Tax) in the respondent's own case vide letter No. F. No. 137/02/2011-service tax dated 10.05.2011 wherein opposite views have been expressed. He further argued that refund has been filed on 05.09.2011 after a lapse of eight years and therefore is barred by limitation.
4. It was further argued by ld. AR that notification 14/2004-S.T. dated 10.09.2004 provides exemption only if the activity is in relation to agriculture, printing, textile processing or education. He argued that the Commissioner (Appeals) has wrongly interpreted the term Education. He argued that the nature of course conducted/service provided by the claimant such as repairing of air conditioner, agri-tourism, aquarium making, dairy milk, milk products making, electric motor rewinding, chalk and candle making are all related to skill development to earn livelihood. These do not come under the category of education. He took us through the definition of Education in Concise Oxford Dictionary and Compact Oxford reference Dictionary. He argued that the impugned order fails to notice that while the respondent are programme implementing agency, their core activity is training and coaching which in turn leads to self employment. He argued that in view of above, the service provided by the respondent fall under the category of Commercial Training & Coaching Services and not under Business Auxiliary Service.
5. Ld. counsel for the respondent argued that they are a programme implementing agency and working at the behest of Government of Maharashtra through MSFC, MSSIDC with a view to encourage entrepreneurship. He pointed out that they are working under centrally sponsored schemes through various ministries and department and government of India and state. He argued that they are not providing any service to the trainee but they are providing training to the trainees on behalf of the central/state government. Thus they are not engaged in the providing of service of Commercial Training & Coaching Services but they are providing training/coaching to the trainees on behalf of central/state government. In these circumstances their services fall under the category of Business Auxiliary Service. He took support from the clarification from Joint Secretary (TRU-III) to Joint Secretary (Rural Department) wherein following has been clarified:-
In this regard, any taxable service provided on behalf of client is classifiable as Business Auxiliary Service [section 65(105)(zzb) of Finance Act, 1994]. In the subject case, taxable service provided in relation to educational training, on behalf of central government, by a PIA, be it a state government department/agency or a private sector company, during the course of implementation of a centrally sponsored scheme does not attract service tax since the same is covered by the exemption under notification No. 14/2004-S.T. dated 10th September, 2004.
6. He further brought to our attention the letter written by the Additional Commissioner in the office of Chief Commissioner, Pune to OSD(ST), CBEC wherein it has been specifically recommended that the letter written by the Director, Service tax dated 10.05.2011 (referred above) may be withdrawn in view of the clarification issued on 26.07.2011.
7. We have gone though the rival submissions. We find that three issues need to be decided:-
i) If the service provided by the respondent is covered under Commercial Training & Coaching Services or Business Auxiliary Service.
ii) If the appellants are entitled to benefit of notification 14/2004-S.T. dated 10.09.2004.
iii) If the refund claim is barred by limitation.
8. It is apparent from the letter of Joint Secretary (TRU-III) to Joint Secretary (Rural Department) that the services in the field of education training provided by programme implementing agency on behalf of central/state government would be classified under Business Auxiliary Service. In view of the above and the fact that the respondent are not providing any service to the trainee but they are providing service to central/state government, it is apparent the service provided by them is correctly classified under Business Auxiliary Service, as service provided on behalf of their client. It is seen that order in original itself classifies the services as Business Auxiliary Service.
9. In so far as benefit of notification 14/2004-S.T is concerned it is seen that the same is available only if the activity are undertaken in relation to agriculture, printing, textile processing or education, revenue has argued that the activity undertaken by the appellants is not in the field of education, but in the field of vocational training. It is argued that vocational training does not amount to education. For this purpose revenue has relied on the following argument;
As per Concise Oxford Dictionary, educate means to give an intellectual, moral and social instruction to (a pupil, especially a child) as a formal and prolonged process. If followed by in or to, plus infinitive, it means, train or instruct for a particular purpose. Education means the act or process of educating or being educated, systematic instruction. As per Collins English Gem Dictionary, educate means bring up, train mentally and morally; provide schooling for. As per Compact Oxford Reference Dictionary Education is defined as 1. The process of teaching or learning. 2. The theory and practice of teaching 3. Training in a particular subject.
From the aforesaid definitions the revenue has argued that the courses conducted by the repairing of air conditioner, agri-tourism, aquarium making etc. are all related to skills development to earn livelihood and cannot be termed as education.
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. On a perusal of the definition relied upon by the revenue, in its review order, it is seen that all the definition include training as a component of education. It is seen that the activities conducted by the respondent are in nature of training for a particular purpose like repairing of air conditioner, agri-tourism, aquarium making etc. In these circumstances, it cannot be denied that these activities are related to education. Thus the benefit of notification 14/04-S.T. cannot be denied to the respondent. 11. In so far as third issue on limitation is concerned, it is seen that the same is not challenged by the review order. 12. In view of above, we find no merits in appeal of the revenue and hence it is dismissed.