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2016 (2) TMI 475 - AT - Service TaxExport of services - taxability of ‘management, maintenance or repair' service rendered by the respondent prior to the amendment of Export of Service Rules, 2005 - Assessee submitted that 97% of their services are rendered to foreign clients and are provided by accessing the server/system of the client located outside India through internet and that, to the extent that these services have the effect of making the software functional at the client's end, at least a part of the service is performed outside India. - Held that:- When there is a specific deeming of exports in a particular circumstances that squarely fits the activities of the respondent, reference to the meaning of a specific phrase in the general provision is irrelevant. Whether it is ‘technical testing and analysis' or ‘management, maintenance or repair' that is performed on software of the clients of the respondent, it is accepted that expert employees sitting in India have to access the servers/computer networks abroad. The performance of these operations is manifested in the efficient and smooth working of the software in the operations of the client. The location of the client cannot be uncoupled from the performance of the service. And as at least some portion of the service is, thereby, rendered outside the country and hence the renders these services outside the ambit of taxation even before 1 st March 2008. Demand of service tax set aside - Decided in favor of assessee.
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