Affiliation Fees Charged by University Not Taxable, Covered Under Negative List: CESTAT [Read Order]
Relying on the Madras High Court’s judgment in Madurai Kamraj University v. Joint Commissioner of GST & Central Excise, which held that such educational services fall under the negative list in Section 66D(l) of the Finance Act
![Affiliation Fees Charged by University Not Taxable, Covered Under Negative List: CESTAT [Read Order]](https://www.taxscan.in/wp-content/uploads/2025/05/CESTAT-Covered-Under-Negative-List-Affiliation-Fees-Charged-by-University-taxscan.jpg "Affiliation Fees Charged by University Not Taxable, Covered Under Negative List: CESTAT [Read Order]")
The Delhi Bench of Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ) ruled that affiliation or inspection fees charged by the assessee, were not taxable under service tax, as such services fall within the negative list under Section 66D(l) of the Finance Act,1994. Barkatullah University,appellant-assessee,was investigated by the DG GSTI, which found that it had not paid...
The Delhi Bench of Customs, Excise and Service Tax Appellate Tribunal ( CESTAT ) ruled that affiliation or inspection fees charged by the assessee, were not taxable under service tax, as such services fall within the negative list under Section 66D(l) of the Finance Act,1994.
Barkatullah University,appellant-assessee,was investigated by the DG GSTI, which found that it had not paid service tax on affiliation/inspection fees and rental income for the period from July 2012 to June 2017. The total taxable amount was ₹22.03 crore, and the service tax liability, including cess, was ₹2.89 crore.
A show cause notice dated 7.3.2018 was issued proposing recovery of the tax along with interest and penalty. These demands were later confirmed in the impugned order.
The two member bench comprising Dr.Rachna Gupta (Judicial Member) and P.V. Subba Rao (Technical Member) noted that the key issue in this case was the taxability of affiliation and inspection fees. Universities, including the assessee, charged fees for granting affiliation to colleges and institutions. The impugned order had held that such services were not covered under the negative list in Section 66D(l) of the Finance Act and were therefore taxable.
F.I.R to Trial—Know Your Rights! Don’t stay uninformed - Click Here
Read More: CVD Exemption Benefit Can Be Claimed Later Even If Not Initially Invoked: CESTAT
The assessee argued that affiliation fees fell within the negative list under Section 66D(l), relying on the Madras High Court’s judgment in Madurai Kamraj University v. Joint Commissioner of GST & Central Excise, where it was held that no service tax could be levied on educational services provided by universities, including affiliation.
The appellate tribunal observed that this judgment had been followed in multiple cases where similar service tax demands were set aside. The departmental representative reiterated the findings of the impugned order but admitted that the issue was identical to the one considered in the Madurai Kamraj University case.
Accordingly, the CESTAT held that the demand on this count could not be sustained and needed to be set aside .Therefore, the appeal was allowed.
To Read the full text of the Order CLICK HERE
Support our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates
