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TMI Blog2013 (3) TMI 420X X X X Extracts X X X X X X X X Extracts X X X X ..... uch as such services rendered by the appellant were not consumed within the Special Economic Zone. Hence, it appeared that Pricewater were not eligible to avail exemption under Notification No. 4/2004-S.T. Accordingly, the appellant were liable to pay Service tax to the tune of Rs. 64,185/- 2.1 It was also noticed that the appellant had rendered professional service relating implementation of MS Dynamics NAV Version 4.0 to M/s. Landmark Ltd., Chennai. For implementation of the project, the appellant had purchased software for Rs. 13,03,144/- and received Rs. 17,96,585/- as reimbursement vide Invoice No. 2007-08/INV-CST/006 dated 12-10-2007 (Billing Slip Ref. No. KOL/BSLIP-ADV/24575926). It appeared that though the appellant had paid Service tax on the submission of configured system, FRD, completion of VAT & Testing, they had not paid Service Tax on the software used for rendering the service. As the software is essential for implementation of ERP system and since the service could not have been rendered without the same, it appeared that the expenditure incurred in procuring the software shall from part of the taxable value. Accordingly, it appeared that the appellant were liable ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any other place of business in the Country; (ii) that the Services availed from them have been consumed exclusively for the purpose of their SEZ operations and are consumed within the SEZ. Hence, the services rendered by them do not attract levy of Service tax and hence the benefit of Notification No. 4/2004 should be made available to them (iii) (a) that they rendered professional services relating to implementation of MS. Dynamic NAV version 4.0 to M/s. Land Mark Limited, Chennai. For implementation of the project they had purchased software for a sum of Rs. 13,03,144/- and sold the same to the customer for a sum of Rs.17,96,585/- vide Billing slip KOL/BLSLIP-ADV/24575926; (b) that the supplies were effected from their Kolkata office and the commercial invoice was raised from the said office, vide invoice number 2007-08/INV/CST/006 of October 12, 2007. There is a transfer of property in goods, namely software and accordingly, a CST at the rate of 4% amounting to Rs. 69,099/- had been charged on the value of software; (c) that as there has been a transfer of property in the goods, namely software, and inasmuch as the relevant CST thereon had been remitted, the said value nam ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lue of software sold to M/s. Landmark is includible in the taxable value for payment of Service tax by the appellant? (iii) the appellant is liable to pay service tax on the service charges received in foreign currency from M/s. Pricewater, Colombo? Let me discuss the issues one by one. (i) Whether the appellant is liable to pay Service tax on the charges realized by them for the services rendered to the SEZ units? 5.1 I find the Notification No. 4/2004-S.T. clearly exempts all taxable services provided to a Developer of SEZ or a SEZ unit for consumption of the services within such SEZ. From the impugned order-in-original, I find that the Lower Authority has denied exemption under Notification No. 4/2004-S.T. on the ground that such Service (conducting internal audit and indirect tax support service) is not consumed within SEZ. Hence, it has to be decided whether the Service could be treated as consumption of services within SEZ. It is seen that the SEZs are specifically delineated duty free enclave and shall be deemed to be foreign territory for the purpose of trade operation. The SEZs are developed for the purpose of promotion of exports to earn much needed foreign exchange ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fit under different provisions for the same transaction on the other hand. (ii) Whether the value of software sold to M/s. Landmark is includible in the taxable value for payment of Service tax by the appellant? 5.2 I find from the records that the appellant was issued with show cause notice for non-payment of service tax on the amount reimbursed by M/s. Landmark towards purchase of software by the appellant for implementation of project to M/s. Landmark. The appellant had contended that purchase of software is a sale of property and CST @ 4% is paid on it; that the value of software sold to Landmark was not includible in the taxable value inasmuch as the goods sale suffered CST. I find force in the argument of the appellant that when there is sale there will be no service. It is pertinent to note here that the appellant had paid service tax for the professional service rendered to M/s. Landmark, Chennai on the very specific project. Hence, I hold that the value of software sold to M/s. Landmark is not includable in the taxable value and the appellant is not liable to pay Service tax on the same during the disputed period. (iii) Whether the appellant is liable to pay service tax ..... X X X X Extracts X X X X X X X X Extracts X X X X
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