TMI Blog2010 (4) TMI 675X X X X Extracts X X X X X X X X Extracts X X X X ..... n which the Commissioner, as revisional authority, has assessed and demanded service tax. consulting engineers’ service - the appellant received from the foreign company an amount of US$ 10 lakhs as consideration for transfer of technical know-how for operating a pharmaceutical manufacturing plant in Dubai - the appellant also received separate consideration at the rate of 0.5 per cent of the Net Invoice Price of products sold within the territory of the Gulf Co-operation Council, from M/s. Global Pharma. These amounts collected by the appellant from M/s. Global Pharma have also been subjected to levy of service tax. Export of service, which was exempt from payment of service tax under Notification No. 55/98-ST, as amended by notificat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any (JVC) was constituted between M/s. Kopran Ltd. (appellant) and M/s. Industrial Promotion Services (Uganda) 1995 Ltd. The JVC was called M/s. Allied Pharmaceutical Industries Ltd. Under this agreement, the appellant was to be paid by the JVC a fee at the rate of 2 per cent of the total annual net sales turnover of the JVC under a separate technical assistance and management backup agreement. It appears, such technical assistance and management backup agreement was also concluded between the appellant and the JVC and, thereunder, the above fee was received by the appellant from the JVC for the technical assistance provided by the former to the latter. The fee so collected by the appellant from the JVC is a part of the taxable value on wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act, 1994, prior to the period of dispute in this case. The original authority, upon a study of the above agreements held, in adjudication of a show-cause notice that the appellant was not liable to pay service tax as demanded in the show-cause notice. In taking this view, the said authority observed that service tax could not be levied from a firm or company under the above head unless it was an engineering organization. The Commissioner, as revisional authority, issued a show-cause notice dated 26-11-2008 under section 84 of the Finance Act, 1994, seeking to revise/set aside the decision of the lower authority. This proposal was contested by the assessee. The Commissioner ultimately confirmed the demand of service tax against the assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... same is presently covered by Intellectual Property Rights , which was introduced as a taxable service only on 10-9-2004. Further, it is pointed out that, even if it is assumed that the appellant rendered a taxable service to the foreign companies, it is a case of export of service, which was exempt from payment of service tax under Notification No. 55/98-ST, as amended by notification dated 6-10-2009, inasmuch as the consideration for the service was collected in convertible foreign exchange. It is submitted that this contention was raised in the very reply to the show-cause notice but the same was not considered by the learned Commissioner. 9. The learned SDR submits that payment in convertible foreign exchange by the overseas recipie ..... X X X X Extracts X X X X X X X X Extracts X X X X
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