Custom, Excise & Service Tax Tribunal
Kalinga Institute Of Industrial ... vs Bhubaneshwar-I on 18 February, 2026
IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL
EASTERN ZONAL BENCH: KOLKATA
REGIONAL BENCH - COURT NO. 1
Service Tax Appeal No. 76030 of 2016
(Arising out of Order-in-Original No. COMMR/B-I/ST-29/2015 dated 18.03.2016
passed by the Commissioner of Central Excise, Customs and Service Tax,
Bhubaneswar-I Commissionerate, C.R. Building, Rajaswa Vihar, Bhubaneswar -
751 007, Odisha)
M/s. Kalinga Institute of Industrial Technology : Appellant
Plot No. 383, 384, A.T./P.O.: - KIIT (Patia),
Bhubaneswar - 751 024, Odisha
VERSUS
Commissioner of Central Excise, Customs and : Respondent
Service Tax
Bhubaneswar-I Commissionerate,
Central Revenue Building, Rajaswa Vihar,
Bhubaneswar - 751 007, Odisha
APPEARANCE:
Shri C.R. Das, Advocate, for the Appellant
Smt. K. Kalpana, Authorized Representative, for the Respondent
CORAM:
HON'BLE SHRI ASHOK JINDAL, MEMBER (JUDICIAL)
HON'BLE SHRI K. ANPAZHAKAN, MEMBER (TECHNICAL)
FINAL ORDER NO. 75257 / 2026
DATE OF HEARING: 05.02.2026
DATE OF DECISION: 18.02.2026
ORDER:[PER SHRI K. ANPAZHAKAN] The present appeal has been filed against the demand of Service Tax of Rs.2,38,38,914/- (inclusive of cesses), along with interest and penalties, as confirmed vide the Order-in-Original No. COMMR/B- I/ST-29/2015 dated 18.03.2016 passed by the Ld. Commissioner of Central Excise, Customs and Service Tax, Bhubaneswar-I Commissionerate, C.R. Building, Rajaswa Vihar, Bhubaneswar - 751 007, Odisha.
Page 2 of 14Appeal No.: ST/76030/2016-DB
2. The brief facts of the case are that M/s. Kalinga Institute of Industrial Technology, Plot No. 383, 384, A.T./P.O.: - KIIT (Patia), Bhubaneswar - 751 024, Odisha [hereinafter referred to as the "appellant"] is a registered Co-operative Society under the Societies Registration Act, XXI of 1860 and being a charitable Organisation, registration is granted under Section 12A of the Income Tax Act, 1961. The appellant is running an educational institution. In order to comply with the obligations under the Service Tax, the appellant was registered under 'management consultancy services' and 'renting of immovable property services' on 10.08.2007.
2.1. On 03.05.2005, the appellant entered into an agreement with M/s. Tata Consultancy Services (TCS) for providing facilities in conducting initial learning programme at KIIT Campus i.e. Bhubaneswar and Noida. As per the agreement, the appellant was under
obligation to provide:
(i) infrastructure and facilities consisting of class room, faculty room, office, reprographic room, library cum reading hall, store room, computer lab, Server room, conference hall and auditorium.
Further to provide printer, photocopier, generator and canteen facility.
(ii) Accommodation: The appellant provided 52 numbers of 3 bed room bungalows;
(iii) General requirement: transportation facility, medical facility. Laundry facility, cleaning facility and security facility,
(iv) Financial: Consideration of Rs.36,00,000.00 per month.
Page 3 of 14Appeal No.: ST/76030/2016-DB
3. Investigation was initiated on 20.08.2008 by the Revenue regarding non-payment of service tax for the above said consideration received by the appellant. During the course of verification, the officers scrutinised the agreement entered by the appellant with M/s. TCS, their trial balance sheet, profit & loss account and other records.
4. Pursuant to the above, a Show Cause Notice was issued on 20.05.2009, by invoking the larger period of limitation demanding Service Tax of Rs.2,38,38,914/- (inclusive of cesses), along with interest and penalties.
4.1. Upon adjudication, the Ld. Commissioner has confirmed the demand of Service Tax of Rs.2,38,38,914/- (inclusive of cesses), along with interest. The ld. adjudicating authority imposed a penalty equivalent to the amount of Service Tax demanded, under Section 78 of the Finance Act, 1994, along with a penalty of Rs.10,000/- under Section 77 of the said Act.
4.2. Aggrieved by the confirmation of the above demands, the appellant has filed this appeal.
5. The demands under dispute in the present appeal are summarized below: -
Period Category of Value received Service Tax taxable service (in Rs.) liability (in Rs.) 01.05.2006 to Business support 18,52,19,702/- 2,28,25,764/- 31.03.2008 service 01.06.2007 to Renting of immovable 4,92,313/- 60,850/- 31.03.2008 property 01.04.2005 to Management or 1,00,78,181/- 9,52,300/- 31.03.2008 business consultant's service TOTAL 19,57,90,196/- 2,38,38,914/-Page 4 of 14
Appeal No.: ST/76030/2016-DB
6. In respect of the demand of Service Tax of Rs.2,28,25,764/-, the Ld. Counsel appearing on behalf of the appellant submits that the demand to this extent has been raised under the category of 'business support services' on the services rendered by them to M/s. TCS. He referred to the agreement entered into by the appellant with M/s. TCS, stating that the appellant has provided class rooms, library cum reading hall, store room, computer lab, conference hall, auditorium, residential accommodation, security and cleaning facility to the training personnel of M/s. TCS; that M/s. TCS is having their business in the Information Technology (IT) Sector; that the scope of business support services would include only such specific activities which are rendered by the service provider to promote the business of the customer. He contends that as the appellant has not provided such services to promote the business of TCS in the instant case, the said services provided by the appellant to M/s. TCS cannot be brought under the ambit of Section 65(104c) of the Act. With reference to the fact that the Order-in- Original confirmed the demand on such services on the ground that the appellant has provided 'infrastructure support services', he contended that although as per the explanation to section 65(104c) it is ascertainable that providing office space along with facilities, is covered under Infrastructure Supply Services, the appellant has not provided such services; that their main services were to provide class rooms with associated facilities with accommodation, Transportation, canteen, Security, Laundry, cleaning, etc., for training of the personnel of TCS. Therefore, it is argued that the said activities undertaken by the appellant are not falling under the Page 5 of 14 Appeal No.: ST/76030/2016-DB 'business supply services'. In support of their contentions, the appellant herein relies on the following decisions: -
(i) Essar Power Ltd. versus Commissioner of Central Excise & Service Tax, Surat-I. [(2024) 18 Centax 273 (Tri. Ahmd.)]
(ii) Shriram Chits Pvt. Ltd. versus Commissioner of C.Ex., CUS. & Service Tax, Hyderabad.
[(2023) 3 Centax 7 (Tri. Hyd.)]
(iii) Tulip Global Pvt. Ltd. versus Commissioner of Central Excise, Jaipur. [2019 (28) G.S.T.L. 270 (Tri.- Del.)] 6.1. In addition to the above, the appellant has also tendered the following submissions: -
(i) That the appellant provided services to M/s. TCS from its campus situated at Bhubaneswar and Noida. For the year 2007-08 amount received from Bhubaneswar amounts Rs.2,16,00,000.00 and from Noida Rs.4,59,00,000.00 as evident from the Annexure-4A to the Show Cause Notice. Similarly in respect of the receipt of consideration in the previous periods, the consideration was received for providing services at Noida, for which the Adjudicating Authority of Bhubaneswar Commissionerate-I has no jurisdiction. Therefore, the impugned order has been passed in excess of jurisdiction, hence deserved to be set aside.
(ii) That the appellant has provided services of in-
house training and seminar mostly to Government Departments and received amount for the same which were used towards the expenses. Providing such in-house training facility and conducting seminars for the Page 6 of 14 Appeal No.: ST/76030/2016-DB Government Departments, is not covered under "Management and Business Consultancy Services" as provided under Section 65(65) of the Act. Management consultancy services means providing any services in connection with management of any Organisation and includes advice, consultancy, technical assistance in similar manner. However, the present services provided by the appellant are not covered under such definition. That from the documents, it is ascertainable that the sanction amounts of the Government are subject to conditions in respect of expenses. As such, the sanction amounts of the Government were used by the appellant for the expenses of the training personnel only and therefore, does not get covered under the definition of Management Consultancy Services.
6.2. The Ld. Counsel for the appellant has also contested the demand on the ground of limitation. In this context, he stated that the Show Cause Notice dated 20.05.2009 proposed for demand of Service Tax for the period from 01.04.2005 to 31.03.2008 by invoking the larger period of limitation. Pointing to the fact that the entire information has been ascertained from the balance sheet, profit & loss account and ledger of the appellant, it is contended by the appellant that the allegations of suppression with intent to evade payment of tax remains un- established. Therefore, the Ld. Counsel for the appellant argues that the impugned order demanding Service tax, interest and penalty is barred by limitation. Reliance has been placed by the appellant on the following case-law: -
Page 7 of 14Appeal No.: ST/76030/2016-DB
(i) Teena Gupta Vs. Commissioner of Central Excise & Service Tax, Indore [(2025) 27 Centax 79 (Tri. Del)]
(ii) Order dated 02.01.2023 of the Hon'ble High Court of Orissa in OTAPL No.10 of 2020
7. On the other hand, the Ld. Authorized Representative of the Revenue appearing before us has reiterated the findings in the impugned order. She submits that the appellant has provided 'infrastructure support' to TCS to promote their business; TCS is a commercial concern and hence, the infrastructure services rendered by the appellant are squarely covered by the definition of 'business support services' as defined under Section 65(104c) of the Finance Act, 1994.
8. Heard both sides and perused the records of the case.
9. We find that the demand of Rs.2,28,25,764/- has been raised and confirmed against the appellant under the category of business support services as defined under Section 65(104c) of the Finance Act, 1994. For ready reference, the said definition is reproduced below: -
'Support Services of Business or Commerce' means services provided in relation to business or commerce and includes evaluation of prospective customers, telemarketing, processing of purchase orders and fulfilment services, information and tracking of delivery schedules, managing distribution and logistics, customer relationship management services, accounting and processing of transactions, operational assistance for marketing, formulation of customer service and pricing policies, infrastructural support services and other transaction processing."Page 8 of 14
Appeal No.: ST/76030/2016-DB Explanation. For the purposes of this clause, the expression "infrastructural support services"
includes providing office along with office utilities, lounge, reception with competent personnel to handle messages, secretarial services, internet and telecom facilities, pantry and security:] 9.1. From the explanation appended to the above definition of business support services, it is observed that infrastructural support services include providing office along with office utilities, lounge, reception, etc. A perusal of the agreement submitted by the appellant reveals that the appellant has provided the following facilities of infrastructure support to M/s. TCS: -
"I. Infrastructure facilities (1) KIIT would provide its campus 1 (except ground floor) for the exclusive use of TCS with the following facilities:
a) 8 class rooms.
b) 12 faculty rooms,
c) 1 office which can accommodate 4 people
d) 1 reprographic room,
e) 1 library cum reading hall (with all the existing infrastructure),
f) 1 store room,
g) Computer lab(s) that can accommodate 150 associates,
h) 1 server room,
i) 1 conference hall (with existing furniture), and
j) 1 auditorium As per the furniture and fixtures mentioned in the annexure.Page 9 of 14
Appeal No.: ST/76030/2016-DB (2) KIIT would maintain the entire facility as mention in point (1) at its own expenses and resources.
(3) ....
(4) ....
(5) ....
II. Accommodation.
(11) KIIT would source 52 nos. of 3 bedroom bungalows near the training center and 6 people may be accommodated in each bungalow.
Please refer the annexure for details, (12) ....
(13) ....
III. General Requirements:
............."
9.2. From the above, it is evident that the services rendered by the appellant squarely fall within the scope of 'infrastructural support services' as provided under Section 65(104c) of the Finance Act, 1994. Consequently, we hold that the services rendered by the appellant are appropriately classifiable under the category of 'business support services' and liable to service tax.
9.3. We also find that the appellant has contested this demand on the ground of limitation. It is the appellant's contention that the aspect of suppression of facts with intent to evade payment of Service Tax on their part has not been established in this case. The Show Cause Notice in this case has been issued Page 10 of 14 Appeal No.: ST/76030/2016-DB on 20.05.2009, demanding Service Tax for the period from 01.05.2006 to 31.03.2008 by invoking the extended period of limitation. In this regard, we take note of the fact that the entire demand has been raised on the basis of information gathered from the records of the assessee. There is no evidence available on record to substantiate the allegation of the Revenue that the appellant had wilfully suppressed the material facts with the intention to evade the payment of Service Tax. Under such circumstances, we are of the opinion that the demand confirmed by invoking the extended period of limitation cannot be sustained. Accordingly, we agree with the submission of the appellant that the demand confirmed against them by invoking the extended period of limitation is not sustainable. We thus confirm the demand for the normal period of limitation under the category of 'business support service', along with interest. As suppression of fact with intention to evade the tax has not been established in this case, we hold that no penalty is liable to be imposed on the appellant in respect of this demand confirmed for the normal period.
10. Regarding the demand of Rs.60,850/-, it is observed from the records that the said demand has been raised on the rent received by the appellant from M/s. Allahabad Bank and M/s. R.&B. Catering Services, under the category of 'renting of immovable property service' under Section 65(90a) of the Finance Act, 1994.
10.1. We observe that the issue as to the taxability of 'renting of immovable property service', was a subject matter of litigation and sub judice in the case of M/s. Home Solutions Retail (India) Ltd. v. Union of India.
Page 11 of 14Appeal No.: ST/76030/2016-DB Subsequently, in the Budget, 2010, by way of amendment in the Finance Act (in 2010), 'renting of immovable property' was made a taxable service. Post the amendment, the Hon'ble High Courts at Bombay, Gujarat, Karnataka, Orissa, Punjab and Haryana, have upheld the levy of Service Tax and the validity of retrospective amendment. The Hon'ble Delhi High Court in the case of M/s. Home Solutions Retail (India) Ltd. v. Union of India vide Order dated 23.09.2011 also upheld the constitutional validity of the retrospective amendment by the Finance Act, 2010. Therefore, we hold that the said services rendered by the appellant are liable to be taxed under the category of 'renting of immovable property service'.
10.2. However, we take note of the submission of the appellant that as the issue was under dispute during the relevant period, no mala fide intent can be attributed to the appellant in relation to the non- payment of Service Tax under the above category of service for demanding Service Tax, by invocation of the extended period of limitation. In fact, it is seen that only vide the Budget, 2010, the retrospective amendment was brought in. Therefore, we do not find any substance in the allegation of the Revenue in this regard that the appellant has intentionally not paid Service Tax on the rent received by them. In view of the above, we hold that the demand of Service Tax confirmed in this regard for the extended period of limitation is not sustainable. Accordingly, we uphold the demand of Service Tax under the category of 'renting of immovable property service' for the normal period alone, along with interest. As suppression of fact with intention to evade the tax has not been established in this case, we hold that no penalty is Page 12 of 14 Appeal No.: ST/76030/2016-DB liable to be imposed on the appellant in respect of this demand confirmed for the normal period.
11. Regarding the demand of Rs.9,52,300/- as demanded under the category of 'management or business consultancy service' in terms of Section 65(65) of the Finance Act, 1994. We find that the appellant has received charges for training and consultancy works. The appellant is an established university with huge infrastructure available for educational purposes. Accordingly, many social and educational institutes preferred to conduct training programmes / seminars and money received from such programmes was utilized for the purpose of stay, transportation, food, etc. Thus, the appellant have done the above activity only with an idea to promote education.
11.1. In the impugned order, we find that the said activity has been held as liable to Service Tax under the category of 'management or business consultancy service'. We find that it is on record that the appellant is not a professional management or business consultant. As per the definition of 'management or business consultancy', Service Tax is liable to be paid by a person who is engaged in providing any service either directly or indirectly in connection with the management of any organisation or business in any manner and includes any person who renders any advice, consultancy or technical assistance, in relation to financial management, human resources management, marketing management, production management, logistic management or any other similar areas of management. We find that the services rendered by the appellant do not fall within the scope of the definition of management or business Page 13 of 14 Appeal No.: ST/76030/2016-DB consultancy service. Accordingly, we are of the view that the demand of Service Tax confirmed in the impugned order under the category of 'management or business consultancy service' is not sustainable. Consequently, the said demand stands set aside. As the demand on this count cannot be sustained, the question of demanding interest or imposing penalty in this regard does not arise.
12. In the result, we pass the following order: -
(i) The demand of Service Tax of Rs.2,28,25,764/- under the category of 'business support service' is confirmed for the normal period of limitation, along with interest. The demand pertaining to the extended period of limitation, along with interest, is set aside.
(ii) The demand of Service Tax of Rs.60,850/-
under the category of 'renting of immovable property' is confirmed for the normal period of limitation, along with interest. The demand pertaining to the extended period of limitation, along with interest, is set aside.
(iii) The demand of Service Tax of Rs.9,52,300/-
under the category of 'management or business consultancy service', along with interest, is set aside.
(iv) All the penalties imposed on the appellant are set aside.
Page 14 of 14Appeal No.: ST/76030/2016-DB
13. The appeal is disposed of in the above manner.
(Order pronounced in the open court on 18.02.2026) Sd/-
(ASHOK JINDAL) MEMBER (JUDICIAL) Sd/-
(K. ANPAZHAKAN) MEMBER (TECHNICAL) Sdd