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2017 (5) TMI 521 - CESTAT CHANDIGARHWaiver of Pre-deposit - Software company providing IT services having clientele abroad - reverse charge - The case of the department is that these branch offices of the applicant are providing support services of business or commerce to the applicant in furtherance of their business of the IT services. Since a branch office established in other country by a person in India is treated as a separate person for the purpose of charge of service tax under reverse charge mechanism under section 66A of FA, 1994, therefore the applicant is required to discharge the liability of service tax on the consideration paid to their branch offices, in lieu of such services - the contention of the applicant is that they have reimbursed the salary and other expenses to their overseas branch offices on which the department is asking to the applicant to pay service tax as per section 66A under BSS. Held that: - the applicant is not liable to pay service tax on the amount reimbursed to the branches located overseas - reliance placed in the case of Milind Kulkarni M/s.Tech Mahindra Ltd. vs. CCE, Pune [2016 (9) TMI 191 - CESTAT MUMBAI], where on similar issue, it was held that mere existence as a branch for the overall promotion of the objectives of the primary establishment in India which is essentially an exporter of services does not render the transfer of financial resources to the branch taxable under section 66A - appellant not liable to pay tax on amount reimbursed to the branches located overseas. Insurance service - demand - Held that: - the insurance service providers are not registered with the IRDA, therefore, these services are not taxable under the category of life insurance service under section 65 (105) (zx) and general insurance service under section 65 (105) (d) of the Act - demand set aside - the requirement of pre-deposit of the amount of service tax on this account also waived. With regard to the service tax on visa facilitation under BSS, we find that the services have been received outside India consumed outside India. Therefore, prima facie service tax is not payable by the applicant. Accordingly, the applicant has made out a case of waiver of pre-deposit, we do as the same. The applicant has already made deposit of ₹ 7,28,22,020/-. For compliance of the provisions of section 35F of CEA, 1944 read with section 83 of the FA, 1994, the same is sufficient, we waive the requirement of pre-deposit of balance amount - appeal allowed - decided in favor of appellant.
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