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2020 (11) TMI 391 - AT - Service TaxIntellectual Property Rights Service - Reverse Charge Mechanism - payment made to Fosters Australia towards permanent transfer of Fosters trademark and brand under the Deed of Assignment - transfer of right to use - demand of service tax - extended period of limitation - HELD THAT:- After going through the contents of Deed of Assignment, it is found that the intention of the parties while executing the Deed of Assignment is the permanent exclusive and irrevocable transfer of trademark as well as Intellectual Property Rights in favour of the appellant. After seeing the clauses of the Deed of Assignment, it is found that the impugned order has wrongly interpreted the terms of the Deed to mean that there is only grant of right to use the trademark and no permanent transfer of trademark to the appellant in India. The learned Commissioner has ignored the substance of the clauses and has picked a part of the clause to suit his purpose and used the same to hold that there is no assignment of the trademark and the brand IP, but there is only a transfer of right to use. It is found that besides the Deed of Assignment clearly showing that there is an exclusive perpetual and irrevocable transfer of trademark and Intellectual Property Rights in favour of the appellant from the other corroborative evidence produced by the appellant which has not been considered by the Commissioner at all. The appellant has also produced on record the Income Tax Assessment Order for the financial year 2006-2007 wherein the Commissioner has recorded the purchase of trademark by the appellant - further, the appellants have got registered in his favour Foster’s trademark as a proprietor under the Trademark Act, 1999. The assignment of trademark and the IPR amounts to permanent transfer and no service tax is applicable on permanent transfer of IP Rights by Foster’s to the appellant. Extended period of Limitation - HELD THAT:- The Department was fully aware of the Assignment Deed executed by the appellant with Foster’s Australia - Further, the transfer of Deed of Assignment was disclosed by the appellant in the Books of Accounts and with the Income Tax Authorities and was also registered in their name as proprietor under the Trademark Act, 1999. All these facts clearly show that the appellant has not suppressed any material facts from the Department and the Department was very much aware of the said transaction, hence alleging suppression on the part of the appellant is not sustainable and we hold that the entire demand is also barred by limitation. Appeal allowed - decided in favor of appellant.
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