Ms. Jyoti Balasundaram, Vice-President - Heard both sides on the application for waiver of service tax of Rs. 2,33,16,506 together with interest and penalty of Rs. 2,35,00,000 under section 78 of the Finance Act, 1994. The demand has been confirmed as a result of holding that the applicants were rendering Business Auxiliary Service including forming, training, linking and monitoring of Self Help Groups (SHGs) and recovery of loans given to the SHGs by ICICI Bank. The assessees do not dispute that they are rendering the above services but contend that they are not ‘commercial concern’ as they are registered as non-profit organization under section 25 of the Companies Act, 1956 and, therefore, not liable to pay service tax under section 65(105)(zzb) which, during the relevant period viz., 1-7-2003 to 30-4-2006, covered only commercial concerns. [Section 65(105)(zzb) was amended w.e.f. 1-5-2006 to cover any person in relation to business auxiliary service].

2. We are of the view that the assessees have made out a strong prima facie case on the ground that although they were charging management fees from the bank who lend/advance money to the SHGs, they were a non-profit making organization as no profit or income or profit was paid or transferred to their members directly or indirectly by way of dividend or bonus. This view finds support from the decision of the Tribunal in Institute of Banking Personnel Selection v. CST [2007] 10 STT 489 (Mum. - CESTAT). Although the Commissioner (Appeals) has relied upon the Tribunal’s decision in Punjab Ex-Servicemen Corpn. v. CCE [2009] 18 STT 121 (New Delhi - CESTAT), we find that the decision in the case of Institute of Banking Personnel Selection (supra) has not been brought to the notice of the Bench and further, the existence of two different views itself justifies waiver of pre-deposit. In addition to this, the applicant has a balance of only Rs. 3,15,210.05 in their savings bank account with ICICI bank and therefore they would be put to extreme financial hardship if any pre-deposit is directed. We, therefore, dispense with pre-deposit of the amounts in dispute and stay recovery thereof pending the appeal.