Aircraft Maintenance Training not Taxable as Commercial Coaching: CESTAT Exempts The Bombay Flying Club’s Member Services under Mutuality Doctrine [Read Order]
CESTAT held that DGCA-approved training by The Bombay Flying Club is not taxable as commercial coaching and exempted aircraft maintenance services provided to its members under the doctrine of mutuality, setting aside all service tax demands.
![Aircraft Maintenance Training not Taxable as Commercial Coaching: CESTAT Exempts The Bombay Flying Club’s Member Services under Mutuality Doctrine [Read Order]](https://images.taxscan.in/h-upload/2025/07/31/2071490-aircraft-maintenance-training-not-taxable-commercial-coaching-cestat-taxscan.webp "Aircraft Maintenance Training not Taxable as Commercial Coaching: CESTAT Exempts The Bombay Flying Club’s Member Services under Mutuality Doctrine [Read Order]")
The Mumbai Bench of the Customs, Excise & Service Tax Appellate Tribunal (CESTAT) has given relief to The Bombay Flying Club by quashing service tax demands made on its aircraft maintenance engineering training programs and aircraft repair services provided to its membersThe Bombay Flying Club provides Director General of Civil Aviation (DGCA) approved training in aircraft...
The Mumbai Bench of the Customs, Excise & Service Tax Appellate Tribunal (CESTAT) has given relief to The Bombay Flying Club by quashing service tax demands made on its aircraft maintenance engineering training programs and aircraft repair services provided to its members
The Bombay Flying Club provides Director General of Civil Aviation (DGCA) approved training in aircraft maintenance engineering and it also undertakes maintenance and repair of aircrafts owned by members of the club, which was registered as a non-profit organisation. The Revenue had viewed these services as taxable under “commercial coaching and training” and “management, maintenance and repair services” respectively, invoking Section 65(105)(zzc) and Section 65(64) of the Finance Act, 1994.
According to four show cause notices issued between 2008 and 2011, the Commissioner of GST & Central Excise confirmed a consolidated service tax demand of ₹2,56,05,682, including interest and penalties. The separate proceedings for Financial Year (FY) 2011–12 resulted in partial relief from the Commissioner (Appeals), who upheld the non-taxability of training services but confirmed the demand on repair services.
Aggrieved by the order, the Club filed appeals before the Tribunal. The Revenue also challenged the relief granted on training services.
The Tribunal, comprising Dr. Suvendu Kumar Pati (Judicial Member) and Anil G. Shakkarwar (Technical Member), examined whether the Club's DGCA-approved training qualified as “commercial coaching”.
On relying on the Delhi High Court’s judgment in Indian Institute of Aircraft Engineering v. Union of India (2013), the Tribunal held that training that is recognized by law, even if followed by a licensing exam, does not lose its legal recognition. It referred to Rule 133B of the Aircraft Rules, 1937 and a DGCA letter dated 19.05.2011, confirming that such training is necessary for getting the eligibility for the license.
The Tribunal ruled that the course completion certificate was recognized by law and the training was not taxable, particularly due to Notification No. 33/2011-ST dated 25.04.2011.
The Tribunal noted that the Club charged only the cost of overhauling and rendered the services to its members. Applying the Supreme Court's ruling in State of West Bengal vs. Calcutta Club Ltd. (2019), the Tribunal held that the doctrine of mutuality applied and the services could not be taxed, as a club cannot render services to itself.
The Tribunal allowed both appeals filed by the Club and dismissed the Revenue’s appeal, thereby setting aside all demands, interest, and penalties.
The Club was represented by Yogesh S. Patki, while the Department was represented by Adeeb Pathan.
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