11 February 2008
A gentleman is providing turnkey consultancy for setting up a school. In my opinion, as a Consultant he needs to collect and deposit service tax related to the service. When he approached the service tax authorities for registration, he was advised by an officer that as he is rendering consultancy for an educational activity he need not collect and deposit service tax. Therefore, he need not seek registration. I am not sure if that is the correct position as per law.
The school project is educational in nature, but a person who is rendering consultancy to set it up on turnkey basis is involved in a normal commercial activity and should therefore collect and pay service tax.
I would be grateful if our learned members could give their opinion on the issue.
IT IS TRUE TAHT CERTAIN CATEGORIES OF SERVICE PROVIDERS ARE EXEMPT FROM SERVICE TAX . THE SITUATION IN THE QUERY RAISED IS ONE OF EXEMPTED CATEGORY AS PER DETAILS GIVEN BELOW. Section 65 (105) (zzc) defines taxable services as any services provided to any person, by a commercial training or coaching centre in relation to commercial training or coaching; Coaching means the instructions and advise for athletics, academics or games. Training means development of a habit, thoughts or behavior by discipline and instructions. It may also be with the objective of giving proficiency of efficiency. Service provider: Commercial Coaching or Training Centre which means Institute or establishment providing commercial training or coaching Excluded service provider: a) Individuals b) Institutes, establishment, which provide coaching and training resulting in a certificate or diploma recognized by law, are outside the scope of this levy even if they provide commercial course also. R.V.RAO
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