2014 (1) TMI 1420

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..... the applicants. The applicant paid customs duty on the entire amount of invoice value and cleared the goods. Erection and installation of machineries were undertaken by M/s. Suba Solutions Pvt. Ltd., Chennai, M/s. Indo European Machinery Co. Pvt. Ltd., India and M/s. Suprabhat Trading Corporation, Sivakasi, on behalf of the foreign sellers. Show cause notices were issued to the applicants proposing demand of service tax under the category of "Erection, Commissioning and Installation", on the ground that the erection, commissioning and installation services were provided by a person from outside India who has his permanent address or usual place of residence in a country other than India and the applicant is liable to pay service tax under .....

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..... vt. Ltd., dropped the demand on the same issue. 3. The Ld. AR submits that in this case, service was rendered by the foreign company through sub-contractors in India. He further submits that they are not the branch or agency of the foreign company and therefore explanation (1) of section 66A (2) would not apply in this case. He submits that the adjudicating authority correctly demanded the tax after giving abatement of 67% by Notification No. 1/2006 dated 1.03.2006, which is supported by the decision of the Tribunal in the case of Synergic India Pvt. Ltd. Vs. CST, Pune - 2012 (284) ELT 43 (Tri.-Mum.). He further submits that the order passed by the Commissioner (Appeals) is not binding on the Tribunal. 4. After hearing both sides and on p .....

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..... of Section 66A (2) of the said Act and the Board's clarification, it is clear that a person carrying on a business through a branch or agency in any country shall be treated as having a business establishment in that country, which would include India. On perusal of the impugned order, we find that the foreign company in this case rendered the service of erection, commissioning and installation through their agency in India and the identity of such agency had already been mentioned in the impugned order. In our considered view, prima facie, we find that the foreign company had undertook the erection job through their agency in India and therefore demand of tax under Section 66A is not sustainable. Apart from that, we have noticed the erect .....

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