2023 (3) TMI 739 - AT - Service Tax

Levy of service tax on royalty paid to their foreign service provider under Reverse Charge Mechanism - intellectual property rights or not - M/s. Borelli Tea Holdings Ltd. granted to the Respondent non-exclusive, non-transferrable licence allowing use of its patents and trade marks for manufacture/production of tea and export thereof.

HELD THAT:- As it is an admitted fact that the trade mark and patent rights were not registered in India, which have been obtained by the Respondent for use in India from their foreign principal therefore the said rights were not governed by any law for the time being in force. Therefore relying on the decision of M/S. MUNJAL SHOWA LIMITED VERSUS COMMISSIONER OF CENTRAL EXCISE & ST, DELHI (GURGAON) AND (VICE-VERSA) [2017 (6) TMI 819 - CESTAT CHANDIGARH] it is held that the amount paid by the Respondent as royalty or licence fee is not taxable in India.

There are no infirmity in the impugned order. Therefore the same is upheld and Appeal filed by the Revenue is dismissed.