Hostel services by coaching centres exempt from service tax: CESTAT

The CESTAT has ruled that hostel services provided by coaching centers are exempt from service tax. The tribunal clarified that such services, when integrally linked to the provision of educational coaching, should not be subjected to service tax. This decision provides significant relief to coaching institutes that offer residential facilities to their students, reducing their compliance burden and potential tax liabilities. It emphasizes that the primary nature of the service is educational, and ancillary services like accommodation fall under the same exemption, benefiting both institutes and students.