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Service Tax - Case Laws

Showing 121 to 124 of 124 Records

• 2023 (3) TMI 11
  

  SCN is time-barred or not - Department issued SCN by invoking the extended clause on the ground that the services provided for the clients at Jammu and Kashmir would be exempted services - HELD THAT:- Since the Appellant is not pressing their Appeal on account of merits, I confine myself to issue of time bar alone.

  As rightly pointed out by the Ld. Advocate, there are various decisions of the co-ordinate Benches of Tribunal on this issue, therefore the Appellant cannot be fastened with the burden of any demand pertaining to the extended period. Accordingly, the demand pertaining to the extended period is required to be set aside.

  As the Appellant is not contesting the Appeal on merits, the demand confirmed and interest thereon for the normal period sustains. The penalties imposed under Section 78 and 77 are set aside - Appeal disposed off.

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• 2023 (3) TMI 10
  

  Levy of Service Tax - manufacturer of parts for paper mill machinery and are also registered under the category of Consulting Engineer Service - HELD THAT:- In various cases, it has been held that there was no record available to show the manner in which the activities of repair work were carried out by the taxpayer since there was no contract or agreement. The Delhi Bench of the CESTAT in the case of M/s. Crimpson Electronics [2009 (7) TMI 80 - CESTAT, NEW DELHI] has held that There is nothing on record to show the manner how activities were carried out by the appellant to conclude that repair and maintenance charges were received instead of job work charges. Also there is no contract document available on record to explain the nature of repair and maintenance carried out.

  In this case, further, the Learned Deputy Commissioner for the Revenue was unable to distinguish the above orders nor was he able to contradict the contentions of the appellant as to the non-existence of contract / agreement.

  The demand cannot sustain, for which reason the impugned order is set aside - Appeal allowed.

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• 2023 (3) TMI 9
  

  Refund of the unutilized input service credit - intermediary services or not - export of service or not - input services used by the respondent to export information technology software service to Jindal LLC located in New York, USA under the contracts - place of provision of services.

  According to the department, since the service provider i.e. the respondent is an intermediary, the place of provision of service by the respondent would be the location of the service provider under rule 9(c) of the 2012 Rules - According to the respondent, the place of provision of service shall be the location of the recipient of service as provided under rule 3 of the 2012 Rules.

  HELD THAT:- An intermediary is a person who arranges or facilitates provision of the main service between two or more persons. The respondent is not involved in the arrangement or facilitation of the supply of service. In fact, the respondent had entered into agreement with Jindal LLC for providing telecommunication services and other services on a principal to principal basis. The telecommunication service and other services provided by the respondent qualify for export service since it is providing services to Jindal LLC which is located outside India and is receiving convertible foreign exchange for such services.

  The Commissioner (Appeals) relied upon the decision of the Delhi High Court in VERIZON COMMUNICATION INDIA PVT. LTD. VERSUS ASSISTANT COMMISSIONER, SERVICE TAX, DELHI III, DIVISION-XIV & ANR. [2017 (9) TMI 632 - DELHI HIGH COURT] to hold that the respondent is not an intermediary. It is seen from a perusal of the aforesaid judgment that Verizon India had entered into a Master Supply Agreement with Verizon US for rendering connectivity services for the purpose of data transfer. Verizon US was engaged in the provision of telecommunication services for which it entered into contracts with the customers located globally. Since Verizon US did not have the capacity to provide such services across the globe, it utilized the services of Verizon India to provide connectivity to its customers. The issue, therefore, that arose before the Delhi High Court was whether the telecommunication services provided by Verizon India during the period April 2011 to September 2014 to Verizon US would qualify as ‘export of services’. The department believed that the said services would not qualify as ‘export of services’.

  The Delhi High Court noted that in the process of gathering the data from the entities in India for transmission to Verizon US, Verizon India availed services of Indian telecommunication service providers like Vodafone and Airtel. These service providers raised invoices on Verizon India and Verizon India paid these service providers the requisite charges. Verizon India thereafter raised an invoice on Verizon US for the ‘export of services’ provided by it to Verizon US. Since the recipient of the service (Verizon US) was outside India, Verizon India treated it as an export of service and understood that it was exempted from service tax under the Export of Service Rules 2005. Verizon US, in turn, raised invoices on its customers in the US - The Delhi High Court pointed out that the ‘recipient’ of services is determined by the contract between the parties and this would depend on who has the contractual right to receive the services and who is responsible for the payment for the services provided to the service recipient; there was no privity of contract between Verizon India and the customers of Verizon US; such customers may be the ‘users’ of the services provided by Verizon India but were not its recipients; Verizon India may have been using the services of a local telecom operator but that would not mean that the services to Verizon US were being rendered in India; and the place of provision of such service to Verizon US remains outside India.

  The Commissioner (Appeals) correctly appreciated the position in the impugned order in holding that the respondent was not an intermediary and was involved in export of service to Jindal LLC.

  Circular dated September 20, 2021 issued by the Central Board of Indirect Taxes and Customs also emphasizes that an intermediary essentially arranges or facilitates another supply (the “main supply”) between two or more other persons and, does not himself provide the main supply. It also clarifies that in cases where a person supplies the main supply either fully or partly, on principal to principal basis, the said supply cannot be covered under the scope of ‘intermediary’.

  There are no illegality in the order dated July 14, 2018 passed by the Commissioner - appeal of Revenue dismissed.

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• 2023 (3) TMI 8
  

  Refund of the unutilized input service credit of input services - intermediary services or not - export of Management or Business Consultant Service - place of provision of services.

  According to the department, since the service provider i.e. the respondent is an intermediary, the place of provision of service by the respondent would be the location of the service provider under rule 9(c) of the 2012 Rules - According to the respondent, the place of provision of service shall be the location of the recipient of service as provided under rule 3 of the 2012 Rules.

  HELD THAT:- It would also be appropriate to refer to the decision of the Tribunal in M/S VERIZON INDIA PVT. LIMITED VERSUS COMMISSIONER OF SERVICE TAX [2019 (8) TMI 384 - CESTAT NEW DELHI]. The Tribunal held that as the appellant had provided services under a contract to Verizon US which was located outside India and had raised invoices for such services and received remittance in foreign exchange, the appellant would satisfy the conditions set out in rule 6A of the 1994 Rules.

  Circular dated September 20, 2021 issued by the Central Board of Indirect Taxes and Customs regarding the scope of ‘intermediary’, also emphasizes that an intermediary essentially arranges or facilitates another supply (the “main supply”) between two or more other persons and, does not himself provide the main supply. It also clarifies that in cases where a person supplies the main supply either fully or partly, on principal to principal basis, the said supply cannot be covered under the scope of ‘intermediary’.

  There are no illegality in the order dated March 02, 2020 passed by the Commissioner (Appeals) - appeal of Revenue dismissed.

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