The Bangalore bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) held that the service of conducting examination falls under the category of business auxiliary service and was eligible to get exemption from service tax under exemption notification.
MeritTrac Services Private Limited, the appellant assessee are engaged in the business of evaluating skills, abilities, and knowledge for specific skills in the organization through the use of scientifically developed assessment tools, that as part of services to educational institutions, conducted examinations by themselves or assisted university/ college in conducting the examination.
The revenue appealed against the order passed by the Commissioner for dropping the demand of service tax on the assessee for conducting the examination services.
Dyamappa Airani, the counsel for the revenue contended that the assessee rendered service under the taxable category of ‘Management or Business Consultant service’ as defined under Section 65(65) of the Finance Act,1994, but wrongly claimed the benefit of exemption Notification applicable to Business Auxiliary service.
Further submitted that the demand notices were issued to the assessee for recovery of the service tax not paid by claiming the said exemption notification.
K.S. Ravishankar, K.S. Naveen Kumar, and N. Anand, the counsels for the department contended that the service rendered by the assessee cannot come within the scope of Business or Management Consultant Service and the benefit of Notification was also admissible to the assessee.
The Bench observed that the service concerning education was eligible for the benefit of exemption under the exemption notification and the assessee rightly claimed the benefit under the notification.
The two-member bench comprising D.M Misra (Judicial) and Bhagya Devi (Technical) upheld the decision made by the Commissioner (Appeals) while dismissing the appeal filed by the revenue.
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