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TMI Blog2014 (10) TMI 96X X X X Extracts X X X X X X X X Extracts X X X X ..... Advocate For the Respondent : Mr. A.K. Nigam, A.R. ORDER Per B.S.V.MURTHY Appellant entered into a Technical Collaboration Agreement (TCA) with their parent company Toyota Boshoku Corporation, Japan in terms of which the appellant was licensed to manufacture certain products and also transferred technical information, designs, etc. As per TCA, the appellant was required to pay the foreign com ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ms of Rule 6(1) of the ST Rules, 1994, the liability to pay service tax on receipt basis and w.e.f. 10.5.2008 in respect of transaction between 'associated enterprises', the liability was on the basis of accrual basis instead of receipt/payment of consideration basis. 2. According to the Research and Development Cess Act, 1986 (R&D Cess), on payments made to import of technology by an industrial ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment of service tax on R&D cess deducted by them which had not been paid at that time of deduction but paid at a later date. Learned counsel vehemently argued that intention was to allow the benefit of deduction. In 2004, when R&D cess was introduced and service tax was liable to be paid, there was no problem because service tax was to be paid only after the payment of consideration and not after ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ention was different and in any case, being a creation of statute, we cannot go with intention of legislation. The words in the notification and statutes are clear. Only R&D cess paid can be deducted from the service tax. Moreover iot is not that the appellant had no alternative. R & D Cess can be paid even before making the payment for imported technology or knowhow. Nothing prevented the assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X
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