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2014 (9) TMI 874 - AT - Service TaxBusiness Auxiliary Services - Software design and development service - Reverse Charge Mechanism - Held that:- As per the agreement entered into between TTL & TTL Korea and TDCVL, TTL and TTL Korea have to render Information Technology Services to TDCVL in Korea. The services rendered consist of two components - onsite services rendered by TTL Korea and offshore services rendered by TTL. Nevertheless, the service recipient remained TDCVL and not anybody else, for which they have paid the consideration. As per the agreement, the invoices for the services rendered are raised by TTL Korea on TDCVL for both onsite as well as offshore services. It is also confirmed by the Counsel that VAT/GST liability has been discharged by TTL Korea at the time of supply of services to TDCVL. If that be so, the question of subjecting the same transaction to Service Tax in India at the hands of TTL would not arise at all. As regards the offshore services rendered by M/s. TTL to TDCVL, the same amounts to export of service in terms of Rule 3(2)(a) of the Export of Service Rules, 2005. Information Technology Software service is classifiable under Rule 3(1)(iii) as category-3 service which relates to service consumed abroad by the recipient who is situated outside India. To consider the transaction as export, two conditions have to be satisfied namely the service should be provided from India and should be used outside India and the consideration for the services rendered should be received in convertible foreign exchange. In the present case, it is not in dispute that these conditions have been satisfied for the offshore service rendered by TTL to TDCVL. - Matter remanded back - Decided in favour of assessee.
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