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2016 (2) TMI 24 - AT - Service TaxLevy of service tax on franchisee and royalty fee paid to their US based franchiser - sharing of compensation - appellant is providing training and coaching service - Held that:- It is evident from the above that the percentage of franchisee fee and royalty fee that is 60% paid to the overseas franchisee is 35.5% is the royalty fees is paid to the producer. Therefore, prima facie, we do not find any merit in the appellant's claim that they have already paid service tax on the consideration received from other distributors and only remitted the amount after the payment of service tax. The appellants are registered under training and coaching service in India for which they have discharged service tax and what is demanded in the present appeal is franchisee service which is clearly established as per the agreement. Accordingly, the appellants are liable to pay service tax on the amount remitted to the overseas franchisee as per the agreement. - Stay granted partly.
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