TMI Blog2012 (11) TMI 832X X X X Extracts X X X X X X X X Extracts X X X X ..... service on behalf of Visa/Mastercard. Export of services - held that:- this issue is presently under consideration in the case of Microsoft Coprn. (India) (P.) Ltd. v. CST [2011 (11) TMI 60 - CESTAT, NEW DELHI] before Delhi Bench. The matter stands referred to a third Member to resolve the difference in opinion between the Members of the Bench which heard the matter. - At this stage the benefit of the difference in views could go to the appellant. So at this stage we go by the location of the service provider and take a tentative conclusion that the services were exported. - Stay granted. - ST/801/2011 - ST/S/612/12-CUS - Dated:- 31-5-2012 - MRS. ARCHANA WADHWA, MATHEW JOHN, JJ. Surjit Ghosh for the Appellant. K.P. Singh for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncing the business of the brand owners, the appellants had been promoting the business of the client and had been providing the services to the customers on behalf of the brand owners. According to Revenue the services so provided to the customers on behalf of brand owners by the appellants were covered under Business Auxiliary Service defined under entry at section 65(19) of the Finance Act, 1994 which entry reads as under:- Business Auxiliary Service means any service in relation to: ( i ) Promotion or marketing or sale of goods produced or provided by or belong to the client; or ( ii ) Promotion or marketing of services provided by the client; or ( iii ) Any customer care service provided on behalf of the client; or ( iv ) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... credit card services in their own name and not in the name of Visa or Mastercard. 7. The Counsel submits that the activity for which they are getting payments is for promotion of the brand of "Visa" or "Mastercard". He contests that such services became taxable only from 01-07-2010 when a new entry for "Brand Promotion Service" was included at section 65(105)(zzzzq). Prior to that date, the services received by them could not have been taxed under "Business Auxiliary Service". 8. The Counsel also has a contention that even if the services in question were to be considered as taxable the services were in fact exported in view of provisions in Export of Services Rules, 2005. He points out that both "Business Auxiliary Service" as wel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd subject to several clauses mentioned therein 22. The said sum due to the noticee was subject to the obligations on the part of the notice which were dealt with at para 2.3 of the said agreement which read as under:- The Exclusivity incentive is paid to SBI in expectation that SBI will carry out the following:- ( a ) SBI will launch four new visa exclusive co-brand card programmes by 1 April 2006; ( b ) SBI agrees to keep the four new visa co-brand programmes exclusive from the launch until the end of programme period; and ( c ) SBI commits to issue not less than 100,000 new cards (net of attrition) for each new visa exclusive co-brand programme within the programme period. 23. In relation to the marketing incentive the rel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ervice of Visa/Mastercard or ( ii ) under clause 65(19)(vi) as providing service on behalf of Visa or Mastercard. 13. From the terms of the agreement we are prima facie of the view that both the appellants and brand name owners are providing services to the cardholders as also business establishments which allow card holders to use the cards for payment of money for purchases. The argument that the business of credit card is that of the appellants only is prima facie not acceptable because quiteoften business establishments accept cards based on the logo of the cards. It is also not true that the business is only of the brand name owner because services are marketed also as the service of the entity issuing cards. So the activity is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g of argument that the service to Visa/Mastercard were in fact exported we are aware that this issue is presently under consideration in the case of Microsoft Coprn. (India) (P.) Ltd. v. CST [2011] 34 STT 19/16 taxmann.com 258 (New Delhi - CESTAT) before Delhi Bench. The matter stands referred to a third Member to resolve the difference in opinion between the Members of the Bench which heard the matter. The question is whether the expression "delivered outside India" can be interpreted to mean services "performed in India" which criterion is applied for a different category of services in Export of Services Rules, 2005. At this stage the benefit of the difference in views could go to the appellant. So at this stage we go by the location ..... X X X X Extracts X X X X X X X X Extracts X X X X
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