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2019 (1) TMI 1885 - AT - Service TaxClassification of services - underwriting services or merchant banking services? - activity to perform as the exclusive agent for Radico for identifying potential purchaser for the securities of Radico - reverse charge mechanism - HELD THAT:- At the adjudicating stage, the respondent had produced signed copies of the agreement dated 30.06.2006, which were examined in detail along with the reply to the show cause notice. The Adjudicating Authority found that in the facts and circumstances hereinabove mentioned, that the said agreement dated 30.06.2006 is a legal document. Thus, we find that the allegation in the show cause notice for disbelieving the said agreement dated 30.06.2006 is flimsy. We further find that the agreement dated 30.06.2006 has also got a binding effect on the parties to the transaction, that is between the respondent and the Jefferies, as it is provided in the letter dated 20.04.2006 that the parties shall enter into a formal agreement duly signed by both the parties, which shall morfefully define the terms and conditions of service or the nature of the transactions as well as the respective rights and liabilities. The predominant services provided by ‘Jefferies’ to the respondent is in the nature of underwriting services and not the Merchant Banking Service, as classified by the Revenue - the transactions between the parties has taken place outside India and their remuneration has also not been remitted from India - the demand of service tax is bad, both for mis-classification and also on the ground of territorial jurisdiction. Appeal dismissed - decided against Revenue.
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