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2023 (6) TMI 591 - CESTAT CHENNAI
Levy of service tax - Clearing and Forwarding Agency service - reverse charge mechanism - services were provided as well as consumed outside India - HELD THAT:- The clearing and forwarding agency service that falls under sec. 65(105)(zj) is covered under sub-rule (ii) of the above Rule 3. It is clear that these category of services specified under sub-rule (ii) shall be totally excluded when the services are wholly provided / performed outside India. The adjudicating authority has held that the said Rule would not be applicable to the appellant on the ground that the same would be applicable only when part of the services are performed in India. On reading of the Rule, it is clear that if the services which are mentioned therein are performed outside India, there is no liability to pay service tax.
In the case of the appellant in M/S. SUNDARAM INDUSTRIES LTD. VERSUS THE COMMISSIONER OF G.S.T. & CENTRAL EXCISE, MADURAI COMMISSIONERATE [2018 (12) TMI 947 - CESTAT CHENNAI], for a different period, the Tribunal has held since services have been wholly performed outside India, the activity will not be exigible to service tax by virtue of Rule 3 (ii) of the Taxation of Services (Provided from Outside India and Received in India) Rules, 2006.
The learned AR has relied on the decision in the case of M/S. PARAMOUNT COMMUNICATIONS LTD. VERSUS CCE, DELHI [2018 (9) TMI 503 - CESTAT NEW DELHI]. On going through the said decision, it is seen that the demand has been upheld by the Tribunal observing that part of the services were provided within India. The said decision being distinguishable on facts, it is not applicable.
Thus, the demand cannot sustain. The impugned order is set aside. The appeal is allowed.