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2016 (10) TMI 619 - AT - Service TaxImport of services - reverse charge method - ‘information technology service’ or ‘intellectual property service’ - classification of services - period from 10th September 2004 to 31st March 2007 - transfer of technology against payment based on downloads made by subscribers of the appellant using the service of the provider - involvement of copyright - Reverse Charge Mechanism - rule 2(1)(d)(iv) of Service Tax Rules, 1994 - Held that: - the decision in the case of Government of India v. Indian Tobacco Association [2005 (8) TMI 113 - SUPREME COURT OF INDIA] relied upon where it was held that it is only after enactment of Section 66A, w.e.f. 18-4-2006, that taxable services received from abroad by a person belonging to India are taxed in the hands of the Indian residents. In such cases, the Indian recipient of the taxable services is deemed to be a service provider - the demand relating to the period prior to 18th April 2006 does not have the authority of law. Demand for the period after 18-4-2006 - Section 65(105)(zzr) - section 65(55a) - copyright outside the scope of ‘intellectual property service’ - Held that: - Section 65(105)(zzr) has been invoked in the notice but the nature of ‘technical knowhow’ transferred to appellant from among trade mark, design, patent etc. has not been identified. Likewise, it has not been established if the said ‘intellectual property right’ was acknowledged under the relevant Indian law and, thereby, within the ambit of the definition in section 65(55a). This is a critical flaw. The decision in the case of Tata Consultancy Services Ltd. v. Commissioner of Service Tax, Mumbai [2015 (11) TMI 236 - CESTAT MUMBAI] relied upon - the demand for the period after 18-4-2006 also not tenable. Demand not sustainable - appeal allowed - decided in favor of appellant.
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