Chartered Accountant
Bookmark and Share
click here to subscribe our newsletter
 
 
Corporate News *   CBIC issues draft rules for Customs valuation *  Top Headlines: Threshold for Benami deals, green bond investors, and more *  Govt aims 1-hour clearance for goods at all ports *  Exporters Allowed To Use RoDTEP, RoSCTL Scrips To Pay Customs Duty, Transfer Them; Rules Amended *  Millions of labourers to be affected by brick producers’ strike over hike in GST, coal rates *  Inauguration of ‘kendriya GST parisar’ *  Transporter can seek Release of Conveyance alone, not Goods under GST Act: Madras HC *  GST: Quoting of DIN Mandatory for Responding to Notice, Govt Modifies Portal *  Firms can soon file claims for GST credits of ?400 cr *  CBIC issues modalities for filing transitional credit under GST. *  Mumbai: Man creates 36 fake GST firms, arrested for input tax credit fraud of Rs 23 cr *  Report to restructure Commerce Ministry under study; idea is to set up trade promotion body: Goyal *  Firms can soon file claims for GST credits of ?400 cr *  Gambling Alert! Govt May Levy Up To 28% GST; UP, Bengal Back Move *  EPFO backs raising retirement age to ease pressure on pension funds *  India Moving Up Power Scale, Set to Become Third Largest Economy By 2030 *  Airfares Get Expensive: What Changes for Flyers From Today? *  IRCTC Latest News: Passengers to Pay More For Cancelling Confirmed Rail Tickets Soon. *  IBC prevails over Customs Act, says Supreme Court. *  As GST enters sixth year, a time for evaluation and reassessment *  There’s GST on daily essentials as Centre needs money to buy MLAs: Arvind Kejriwal *  Now, GST on cancellation of confirmed train tickets, hotel bookings *  GST kitty for top States could rise 20% in FY23, says Crisil *  French customs officials seize another cargo vessel over Russia sanctions *  TradeLens builds on Asia momentum with Pakistan Customs deal *  Hike tax on tobacco, reduce affordability & increase revenue: Civil society organizations to GST council *  Bihar: ?10 crore tax evasion on tobacco products detected in raids *  Centre failed on GST, COVID; would it be anti-national? Rajan on Infosys row *  Service Tax not Chargeable on Income Tax TDS portion paid by recipient: CESTAT grants relief to TVS *  Foreign portfolio investors make net investment of Rs 7575cr in Sep so far
Subject News *  Run-up to Budget: Monetary threshold for GST offences may rise to Rs 25 cr *   GST (Tax) E-invoice Must For Businesses With Over Rs 5 Crore Annual Turnover *   Both Central GST and excise duty can be imposed on tobacco, rules Karnataka high court *   CBIC Issues Clarification On Extended Timelines For GST Compliance *   CBIC Issues Clarification On Extended Timelines For GST Compliance *  Budget 2023- 9.6 crore gas connections *  GST: Tamil Nadu Issues Instructions for Assessment and Adjudication Proceedings *  GST: CBIC Extends Last Date for filing of ITC *  GST collection in September surpasses Rs 1.4 lakh crore for straight seventh time *  Dollar smuggling case: Customs chargesheet names M Sivasankar as key conspirator. *  Hike in GST rates fuels inflation *  Assam: CBI arrests GST commissioner in Guwahati *  GST fraud worth ?824cr by 15 insurance Cos detected *  India proposes 15% customs duties on 22 items imported from UK *  Decriminalising certain offences under GST on cards *  Surge in GST collections more due to higher inflation: India Ratings *  MNRE Notifies BCD and Hike in GST Rates as ‘Change in Law’ Events But With a Condition | Mercom India *   Solar projects awarded before customs duty change allowed cost pass-through *  Rajasthan High Court Dismisses Writ Petitions Challenging Levy Of GST On Royalty *   GST revenue in September likely at Rs 1.45 lakh crore *  Govt working on decriminalising certain offences under GST, lower compounding charge *  Building an institution like GST Council takes time, trashing is easy: Sitharaman *  GST collections in Sept may touch ?1.5 lakh crore *  KTR asks Centre to withdraw GST on handlooms *  After Gameskraft, More Online Gaming Startups To Receive GST Tax Claims *  Madras HC: AAR Application Filed Under VAT Does Not Survive After GST Enactment *  Threshold for criminal offences under GST law may be raised *  Bengaluru: Gaming company faces biggest GST notice of Rs 21,000 crore *  CBIC clarifies Classification of Cranes for GST, Customs Duty *  Customs seize gold hidden in bicycle in Kerala airport  

Comments

Print   |    |  Comment

PJ/CASE LAW/2015-16/2770

Whether service tax is payable for training provided to employees of concerns who had purchased software from appellant?

Case:-BENTLY SYSTEM INDIA PVT. LTD. VERSUS COMMISSIONER OF C. EX. & S.T., DDELHI

Citation:-  2015 (37) S.T.R 463 (Del) 

Brief Facts:-The appellant herein is registered with the Service Tax Commissionerate for providing online information and database access or retrieval services; management, maintenance or repair services; information technology software services; and management or business consultancy services. The dispute in the present case is whether service tax is payable on consideration received for training provided to employees of concerns/companies who had purchased the software developed and sold by the appellant. The dispute pertains to the period 2004-05 to 2007-08.

Appellant Contentions:-Learned counsel for the appellant has drawn our attention to the order passed in the case of Commissioner of C. Ex., Chandigarh v. Punjab Communication Ltd. reported in [2012 (25) S.T.R. 89 (Tri.-Del.)], wherein it was observed that training provided to the employees of concerns who had purchased computers, cannot be treated as commercial training or coaching centre services. Reliance is also placed on the decision of Tribunal, Bangalore Bench in Wipro Limited v. Commissioner of Income Tax [2010 (20) S.T.R. 62 (Tri.-Bangalore)], wherein Tribunal observed that the appellant did not, prima facie, fall under the category of "Management Consultants" but was covered in the category of "IT Services". Another decision of Delhi Tribunal in Ruchi Infotech Ltd. v. Commissioner of Central Excise, Indore [2010 (20) S.T.R. 797 (Tri.-Del.)] is relied upon.

Respondent contentions:-The contention of the respondent revenue is that this training is covered under Section 65(26) and amounts to "commercial training or coaching" provided by "commercial training or coaching centre", as defined in Section 65(27) of the Finance Act, 1994 and applicable with effect from 1-7-2003. In Section 65(27), "commercial training or coaching centre" means an institute or establishment providing commercial training or coaching for imparting skills, knowledge or lessons on any subject or field other than sports with or without certificate.

Reasoning of Judgment:-Tribunal, in the impugned order, has observed that the appellant does not have a prima facie case and the activities of training were covered under the head "Commercial Training and Coaching Centre Services". Accordingly, the application for waiver of pre-deposit or grant of stay to this extent was rejected. We are informed that in terms of the order passed by the Tribunal, the appellant will also have to deposit Rs. 53,25,568/- towards penalty. It is pointed out that the interest is payable @18%.
Looking at the nature of the dispute, the quantum involved and the fact that penalty is equal to the amount of tax; we are inclined to modify the order passed by the Tribunal and direct complete waiver of payment of interest and penalty. The direction to deposit the entire principal tax amount is partly modified with a direction to the appellant to deposit Rs. 40, 00,000/- within a period of four weeks. We refrain from giving detailed reasons, but record that the issues raised do merit consideration. The plea of the appellant is that they had supplied and were paid consideration for the software sold. The appellant it is stated was not a commercial training or coaching institute but had developed and had sold software and as a term also trained the employees.

Decision:-Appeal disposed off.

Comment:-The analogy of the case is that since the case involved was arguable, pre-deposit ordered by the Tribunal was modified. The appellant had developed and sold the software and as a term also trained the employees. The appellant is not commercial training and coaching centre. Accordingly, in view of decisions relied upon by the appellant, stay order was modified.
 
Prepared By:- Anash Kachaliya

Department News


Query

 
PRADEEP JAIN, F.C.A.

Head Office : -

Address :
"SUGYAN", H - 29, SHASTRI NAGAR, JODHPUR (RAJ.) - 342003

Phone No. :
0291 - 2439496, 0291 - 3258496

Mobile No. :
09314722236

Fax No. :0291 - 2439496


Branch Office : -

Address:
1008, 10th FLOOR, SUKH SAGAR COMPLEX,
NEAR FORTUNE LANDMARK HOTEL, USMANPURA,
ASHRAM ROAD, AHMEDABAD-380013

Phone No. :
079-32999496, 27560043

Mobile No. :
093777659496, 09377649496

E-mail :pradeep@capradeepjain.com