TMI Blog2015 (1) TMI 1098X X X X Extracts X X X X X X X X Extracts X X X X ..... able Service Rules, 2005. Therefore, the appellant are not required to pay service tax during the impugned period for their activity. Accordingly, they are entitled for refund claim. - in this case appellant had provided services of business support and maintenance and repairs to their client located outside India and performed in India on behalf of client located outside India. Therefore, it is the case of export of services. For the period prior to 2005 when the export of services and goods came into force the appellant is covered by the CBEC circular no.53/5/2003-ST dated 25.04.2003 - appellants are not liable to pay service tax at all. Therefore, question of imposition of penalty does not arise. Consequently, we set aside the impugned order - Decision of Blue Star Ltd. Vs. Commissioner of Service Tax [2014 (12) TMI 25 - CESTAT MUMBAI] followed - Decided in favour of assessee. - Appeal No. ST/141/2009 & ST/53664/2014-CU(DB) - Final Order No. 50142-50143/2015-CU(DB) - Dated:- 8-1-2015 - Hon ble Mr Ashok Jindal And Shri R. K. Singh,JJ. For the Petitioner : Shri B. L. Narsimhan, Advocate For the Respondent : Shri Amresh Jain, DR ORDER Per Ashok Jindal: The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case of Blue Star Ltd. Vs. Commissioner of Service Tax-2014-TIOL-2257-Cestat-Mum and Simpra Agencies Ltd. Vs. C.C.E.-2014 TIOL-687-Cestat-Del. He also relied on the decision of Hon ble High Court of Bombay in the case of SGS India Pvt Ltd. Vs. C.S.T. Mum-2011 (34) STR 60 (Tri-Mum) which has been affirmed by Hon ble High Court of Bombay in the case of C.S.T. Mum Vs. SGS India Pvt. Ltd. reported in 2014-TIOL-580-HC-MUM-ST. 4. On the other hand Ld. AR opposes the contention of Ld. Counsel and submits that the services of maintenance and repair have been executed by the appellant in India and the services recipient are also located in India. Therefore, it is immaterial who is paying the charges for the services rendered by the appellant. In these circumstances, it is not a case of export of service. Therefore, appellant are liable to pay service tax on the activity of repair and 5. Heard the parties and considered the submissions. 6. After going through the arguments advanced by both the sides we find that the facts of this case are similar to the case of Blue Star Ltd. (Supra) wherein the facts of the said case are as under: The appellant is providing services which are tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o be remitted along with commission and the details of the intended beneficiary in India and after payment of money to be remitted along with commission, he is given a unique code number by the WU/their agents/sub-agent. WU do not have any office or business establishment in India and they operate in India through a network of Agents and sub-agents appointed by agents with the approval of WU. The role of Agents and sub-agents is that when the intended beneficiary approaches them with the code number and provides the prescribed proof of identify, they handover the money remitted by the sender immediately. Thereafter the Tribunal has observed further in para 68 69 as under:- 68 . Coming to the question of classification of the activity of Agents and sub-agents, their activity essentially is providing of service of delivery of money on behalf of WU and also undertaking promotion and marketing of the money transfer service provided by WU. Agents by delivering money on behalf of WU to the intended beneficiary of the sender of money abroad are discharging the obligation of delivering money to the intending beneficiaries on behalf of WU and in the cases where the money is deli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... place of consumption and the location i.e. permanent address of the service recipient may be different. A uniform criteria for determining the place of consumption/receipt for different categories of services like, services in relation to immovable property, services in relation to business, performance based services, transport services etc. cannot be adopted. In case of performance based services, there can be cases where part of the service has been performed in India and part has been performed abroad and therefore for such cases there has to be a uniform criteria for determining as to which place should be treated as the place of performance. In case of multi-locational service providers; there must be a uniform criteria for determining as to at which place the multi-locational service provider is to be treated as located for the purpose of taxation. Therefore, what constitutes the export of service cannot be left to the deductive capability of individual tax payers or individual tax collectors, as doing so will cause a total chaos. For this reason only, the Export of Service Rules, 2005 have been framed by the Central Government under Section 94(1)(f) of the Finance Act, 199 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ishment abroad and since this service has been received by WU and used by them in their business and payment for this service has been received in convertible foreign currency , in terms of the provisions of Rule 3(1)(iii) read with Rule 3 (2) of the Export of Service Rules, 2005, the service provided by the Agents has to be treated as export of service. 72. Next comes the question as to whether the services provided by sub-agents appointed by the Agents of WU are export of service and hence not taxable. As held in para 68 above, the services provided by the sub-agents appointed by the Agents is Business Auxiliary Service covered by Section 65(105)(zzb) read with Section 65(19) irrespective of whether it is treated as provided to Agents or to WU. The plea of the sub-agents is that they have tripartite arrangement with Agents of WU and WU, that they also represent WU, that recipient of their services is WU, not the Agents and that, therefore, the services provided by them have to be treated as export of service. The contention of the Revenue on the other hand, is that the sub-agents have provided taxable service to Agents not to WU and therefore, in any case, the commission re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... report of such tests and analysis was sent abroad. The clients of the respondent were foreign clients, paid the respondent for such services rendered, in foreign convertible currency. It is in that sense that the Tribunal holds that the benefit of the services accrued to the foreign clients outside India. This is termed as 'export of service'. In these circumstances, the Tribunal takes a view that if services were rendered to such foreign clients located abroad, then, the act can be termed as 'export of service'. Such an act does not invite a service tax liability. The Tribunal relied upon the circulars issued and prior thereto the view taken by it in the case of KSH International Pvt.Ltd Vs . Commissioner and B.A. Research India Ltd. The case of the present respondent was said to be covered by orders in these two cases. To our mind, once the Hon'ble Supreme Court has taken the view that service tax is a value added tax which in turn is destination based consumption tax in the sense that it taxes noncommerical activities and is not a charge on the business, but on the consumer, then, it is leviable only on services provided within the country. It is this findin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted outside India. Therefore, it is the case of export of services. For the period prior to 2005 when the export of services and goods came into force the appellant is covered by the CBEC circular no.53/5/2003-ST dated 25.04.2003 wherein the CBEC has clarified as under: The Board has examined the issue. In this connection, I am directed to clarify that the Service Tax is destination based consumption tax and it is not applicable on export of services. Export of services would continue to remain tax free even after withdrawal of notification No. 6/99, dated 09.04.1999. Further, it is clarified that service consumed / provided in India in the manufacture of goods which are ultimately exported, no credit of service tax paid can be availed or reimbursed at present as inter-sectoral tax credit between services and goods are not allowed. 9. As we have decided the issue on merits, therefore we are not considering the issue on limitation as stated by the appellant. 10. In these circumstances, we hold that appellants are not liable to pay service tax at all. Therefore, question of imposition of penalty does not arise. Consequently, we set aside the impugned order and allow the app ..... X X X X Extracts X X X X X X X X Extracts X X X X
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