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2017 (12) TMI 451 - AT - Service TaxLiability of service tax - export of service or not? - the service is received by the foreign based client and consideration is received by the appellant-assesses inconvertible foreign exchange - Held that: - It is clear that though the data information and other analysis is collected and done by the appellant-assesses in India, the same is in terms of an agreement with a foreign based company. The foreign based client paid consideration inconvertible foreign exchange. The nature of service being such, the same is for consumption and benefit of the foreign client. Service tax being consumption/destination based tax, we find that the services rendered by the appellant-assesses are, in fact, to be considered as export - the appellant-assesses are not liable to service tax on this service - in favor of assessee. Liability of service tax - expenditure incurred in foreign exchange - includibility - reimbursable expenses - Held that: - It is clear that there is no categorical finding as to how the expenditure incurred in foreign exchange can be considered as a payment towards specific category of taxable service and thereafter can be subjected to tax at the hands of the appellant on reverse charge basis. We find considerable force in appellant-assesse’s plea with reference to presumptive nature of the demand for service tax attributable to expenditure in foreign currency - Admittedly, the reimbursable expenditure incurred by the appellant is as per pre-arrangement and reimbursed by the client on actual basis - The non-includability of reimbursable expenditure in the taxable value has been upheld in large number of decisions by this Tribunal also - in favor of assessee. Appeal allowed - decided in favor of assessee.
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