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2020 (1) TMI 427 - AT - Service TaxClassification of services - Franchise service or not - appellant has entered into agreements with various independent bottlers who possesses the necessary licenses for manufacturing of alcoholic liquors - view of the Revenue is that the appellant has granted representational right to the CBUs and that such service appropriately classifiable as ‘Franchise Service’ - CBEC Circular No. 249/1/2006-CX.4 dated 27.10.2008. HELD THAT:- As per the said circular, the appellant being brand owner and earned the profit/surplus, the same being in nature of business profit and the same is not chargeable to service tax. The said circular has not been withdrawn by the CBEC yet. Moreover, the CBUs are paying service tax under the category of ‘Business Auxiliary Service’ which means the appellant is not a service provider but is a service recipient, in that circumstances, relying on the decision of M/S. BDA PVT. LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE, MEERUT [2015 (6) TMI 586 - CESTAT NEW DELHI] where it was held that the appellant are the Brand Owner of IFML and M/s. Pilkhani is a job worker manufacturing IMFL on behalf of the appellant and the amount retained by the appellant is the business profit not liable to be taxed under the Finance Act, 1994 under the category of Intellectual Property service. Thus, the appellants are not liable to pay service tax - appeal allowed - decided in favor of appellant.
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