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2017 (11) TMI 1405 - CESTAT NEW DELHIReverse charge mechanism - IPR Services - includibility of expenditures - Rule 5 of Service Tax Valuation Rules - Held that: - The appellants are not incurring any extra cost or expense in receiving such service. If at all, the expenses are incurred by the holding company which in any case fixed the consideration for taxable service provided to the appellant. In terms of Rule 7 of Valuation Rules, it is clear that in respect of taxable services provided form outside India the value shall be actual consideration charged for the services provided - In the present case, there is no allegation that the appellants have not discharged service tax on actual consideration charged by the service provider - there is no justification to invoke Rule 5 to hold that the appellants short paid Service Tax on reverse charge basis. Outstanding consideration to be paid by Holding Company - effect of amendment - Held that: - the amendment which brought in a deeming provision for transaction between associate enterprises is applicable from the that date only - the debit entries made prior to 10.05.2008 and shown outstanding on that date cannot be subjected to Service Tax on reverse charge basis based on the explanation, which was introduced under Rule 6 (1) of the Service Tax Rules, 1994 w.e.f. 10.05.2008. Appeal allowed - decided in favor of appellant.
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