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2018 (6) TMI 669 - AT - Service TaxFranchise Service - appellant has developed and is running a course called “Diploma in Advanced Software Technology (DAST) - Revenue was of the view that for the 25% amount retained by the appellant, the appellant is liable to pay service tax under the category of Franchise Service falling under Section 65(47) of the Finance Act, 1994 - Held that:- The issue has been decided against the assessee in appellant’s own case CMC Ltd. V/s Commissioner Hyderabad [2011 (4) TMI 242 - CESTAT, BANGALORE] - the appellant is liable to make payment of Service Tax under the category of Franchise Service for the full period of demand - penalties are set aside. Management Consultancy Service - Revenue was of the view that the activities performed by the appellant in terms of the agreement with DST were liable to payment of service tax under category of Management Consultancy Service falling under Section 65(65) read with Section 65(105)(k) of the Act - Held that:- When we carefully consider the definition of Management Consultant as it existed during the different periods, it is evident that the appellant has not carried out management of any complete organization such as the DST. But what has been done is technical assistance in the operation of the computer systems of DST and management of the Centre. Such activities, definitely are liable to be covered within the terms ‘Technical Assistance in relation to….. any working system of any organization’, In the definition prevalent during w.e.f. 01/05/2006 to 01/06/2007, the activities performed by the appellant would be even more specifically covered under ‘Technical Assistance in relation to…… management of information technology resources’ - the activity performed by the appellant for DST would be covered within the definition of management consultancy services during the period of dispute. Manpower recruitment or supply agency service - the appellant carried out the activities of application data management, pre-examination and post-examination activities. Such activities were in the nature of back end activities and supported the manpower recruitment activity of the client by providing various Services - Revenue was of the view that such activities were covered within the definition of Manpower Recruitment and Supply Agency Service falling under Section 65(68) read with Section 65 (105)(k) - Held that:- The appellant does not deny the fact that the activities are in the nature of pre recruitment work but claims that it willl be covered within the definition only after the insertion of the Explanation w.e.f. 01/06/2007 - The definition covers service rendered to any person in relation to recruitment or supply of manpower. Evidently, the pre recruitment work provided by the appellant would definitely come within the category of ‘service rendered in relation to supply of manpower’. No doubt the Explanation has made this explicit but we are of the view that the activity is covered by the definition even without reading the Explanation retrospectively - demand upheld. Extended period of limitation - Held that:- While we uphold the invoking of suppression clause in the initial show cause notice dated 04/07/2008 for the reasons recorded by the Adjudicating Authority in para 20, we are of the view that the Revenue is precluded from raising the same clause again in the subsequent show cause notice dated 26/02/2010 - we set aside the portion of demand under the category of Management Consultancy Services as well as Manpower Recruitment or Supply Service vide show cause notice dated 26/02/2010, which falls outside the normal time limit in Section 73. Penalties - Held that:- the penalties set aside, by taking recourse of Section 80 since in respect of all the issues interpretation of the provisions is involved. Appeal allowed in part.
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