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2018 (8) TMI 1172 - AT - Service TaxIntellectual Property Service - assessee paid royalty of 1.3% of the net selling price of Ceramic Fibre Products to Morgan Crucible Co. Plc. UK. - demand from 18-04-2006 - Held that:- The said Agreement required the assessee to pay royalty annually to their foreign service provider, based at 1.3% of ceramic refractory fibre sales. As per the two related show cause notices dated 11.8.2008 and 02.02.2009 such payments have been made from September 2004 to December 2006 and January 2007 to December 2007 respectively. No infirmity is then found in the inclusion of Lower appellate authority in para 5.1 of the impugned order that transfer of knowhow is not a onetime affair for which royalty charges are being paid even during the disputed period. Assessee are liable to pay service tax, with interest thereon, on the Royalty charges paid, only w.e.f. 18.04.2006, i.e. after enactment of Section 66A of the Act - appeal allowed - decided in favor of Revenue.
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