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2019 (2) TMI 29 - AT - Service TaxTaxability for the period prior to 09.07.2004 - Maintenance and Repair Services - period under dispute is 09.07.2004 to 31.03.2006 - N/N. 20/2003-ST dated 21.08.2003 rescinded vide N/N. 07/2004-ST dated 09.07.2004 - Circular No. 81/2/2005-ST dated 07.10.2005 - Held that:- N/N. 20/2003-ST dated 21.08.2003 exempted services provided to a customer in relation to maintenance or repair of computers, computer systems or computer peripherals from payment of service tax. Later, it was clarified vide Circular dated 17.12.2003 that the maintenance of software is also a part of computer systems and therefore, would be covered by the exemption Notification. The above Notification was later rescinded by Notification No. 07/2004 dated 09.07.2004. Although the Notification rescinded the above exemption Notification, the said services were not brought into the levy of service tax by the specific Notification - Later, Circular No. 81/2/2005-ST dated 07.10.2005 clarified that maintenance or repair or servicing of software is leviable to service tax. There was much confusion as to whether Maintenance and Repair of computer software is subject to levy of service tax during the disputed period. However, taking note of the fact that the Circular dated 07.10.2005 has been quashed by the Hon’ble jurisdictional High Court, we are of the considered opinion that the Commissioner (Appeals) has rightly applied the law and precedents so as to set aside the demand, interest and penalties. Demand do not sustain - appeal dismissed - decided against Revenue.
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