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2020 (2) TMI 1070 - AT - Service TaxLiability of service tax - peering arrangement - Department has entertained a view that the appellant have entered into a bilateral domestic private “pearing arrangement” with other internet service providers for carrying internet traffic on each others’ backbone. There has been a primary allegation of the Department that the appellant has not discharged service tax on the value of the service provided by them to other internet service providers for carrying their internet traffic on their own backbone - demand alongwith interest and penalty - difference of opinion. HELD THAT:- In view of the separate orders recorded by both the Members, due to difference of opinion, the following questions arise for determination by the third member:- As held by the Member Judicial that the appellant is not liable to pay service tax on their invoice raised on NIXI, as the NIXI is not the ISP and hence, neither the service provider nor the service receiver, hence not liable to pay service tax under the Finance Act, 1994. OR, As held by the Member Technical that the appellant is liable to pay service tax on the services provided to the other ISPs through NIXI, and they have raised invoice for such services provided, on NIXI, and have also admitted to pay service tax. Registry is directed to put up this matter before the Hon’ble President for referring it to the ld. third Member for his opinion.
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