Home Case Index All Cases Service Tax Service Tax + AT Service Tax - 2014 (1) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2014 (1) TMI 1048 - AT - Service TaxNature of payment towards technical knowhow and inspection charges and royalty charges paid to Hitachi Japan - Consulting engineer or ‘Scientific & Technical Consultancy service’ or ‘Franchise service’ - Penalty u/s 78 - Interest u/s 75 - Whether the payment towards Technical Knowhow and inspection charged and Royalty by the appellants to M/s. Hitachi Japan for the period September’ 04 for the service received by them falls in the category of Consulting Engineering Service - Held that:- The technical knowhow provided by the foreign company as per the Licensed agreements was transfer of intellectual property rights and no consultancy or advice was involved and hence the same was not liable to service tax under consulting engineer service. Further the Government has specifically covered this service for levy of service tax with effect from 10/09/2004 under Section 65 (55b) of the Finance Act, 1944 as ‘Intellectual Property Service’ the definition of ‘Intellectual Property Service’ given under clause (55b) of section 65 is very specific and cover within its ambit, the sale of intellectual property right or transfer or just giving right to the other person for the use or enjoyment of any intellectual property right. Therefore the technical knowhow provided by the Licensor could not be termed as advice or consultancy. Similar view that technical knowhow fee and royalty paid to holding company towards right to use trademark merely a transaction in property and not a consultancy advice - Therefore, the technical knowhow provided by the Licensor cannot be equated with any service covered under consulting engineering service for Sep 2004 and hence the service tax demanded and confirmed on royalty under consulting engineering service is set aside - Decided against Revenue.
|