9911796707
TMI Blog2016 (3) TMI 402X X X X Extracts X X X X X X X X Extracts X X X X ..... , appropriation of the amounts paid by the appellant before issue of the show cause notice, and imposition of penalties under section 77 and 78 of Finance Act, 1994. 2. Though the impugned order relates to confirmation of demand of tax for rendering of 'maintenance and repair services' for the period from 15 th March 2005 to 31 st December 2007 and of 'support services of business or commerce' for the period from 1 st May 2006 to 30 th September 2007, the dispute of the appellant is limited to the tax of Rs. 37,32,184/- demanded for the former as well as the penalties imposed in the impugned order. 3. The appellant is a unit registered under the Software Technology Park scheme in the Foreign Trade Policy notified under the Foreign ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... examining the various amendments and the taxability of 'information technology software' reasoned that with the introduction of tax by section 65(105)(zzzze) on 'information technology software', legislative intention to distinguish between this and 'computer software' is unambiguously clear and as all the circulars and decisions hitherto existing related to 'computer software' those were not applicable to the activity performed by the service provider in re SAP India Pvt Ltd. 6. Learned Authorized Representative places reliance on the circular no 81/2/2005-ST dated 7 th October 2005 of Central Board of Excise & Customs that superseded no 70/19/2003-ST dated 17 th December 2003; the clarification in the latter that maintena ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... maintenance or repair' with effect from 1 st May 2006 as below: "management, maintenance or repair' means any service provided by - (i) any person under a maintenance contract or agreement; or (ii) .......... in relation to (a) management of properties, whether immoveable or not; (b) maintenance or repair of properties, whether immoveable or not; or (c) maintenance or repair including reconditioning or restoration, or servicing of any goods ...." and the Explanation therein with effect from 16 th May 2008 read as: 'For the removal of doubts, it is hereby declared for the purposes of this clause - (a) 'goods' includes 'computer software'; (b) 'properties' includes 'information technology s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... puter software', existed from an earlier date, contention of Revenue would render the appellant taxable for the period in dispute. Revenue relies upon the superseding circular no. 81/2/2005-ST dated 7 th October 2005 of Central Board of Excise & Customs which was issued consequent to the decision of the Hon'ble Supreme Court in re Tata Consultancy cited supra. 11. The finely tuned calibration that is demonstrated by the Supreme Legislature in the taxing of various services since 1994 is patently not reflected in the manner in which tax collection is sought to be enhanced by the Central Board of Excise & Customs (or, more probably, by overreach on the part of field offices by confusing the two categories of software). Undoubtedly, c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly desistd from refining upon the different thus: "25. At this stage it must be mentioned that Mr. Sorabjee had pointed out that the High Court has, in the impugned Judgment, held as follows: ".......In our view a correct statement would be that all intellectual properties may not be 'goods' and therefore branded software with which we are concerned here cannot be said to fall outside the purview of 'goods' merely because it is intellectual property; so far as 'unbranded software' is concerned, it is undoubtedly intellectual property but may perhaps be outside the ambit of 'goods'". [emphasis supplied] 26. Mr. Sorabjee submitted that the High Court correctly held that unbranded software was "undoub ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erefore, and more particularly in the context of the new taxable entry of 2008, restricted to computer software, which appears to be interchangeable with proprietary software, whose maintenance alone is liable to be taxed prior to 16 th May 2008 under section 65(105)(zzg). 15. The decision of the Hon'ble High Court of Andhra Pradesh would, therefore, persuade us that software, other than 'canned' would not be amenable to description as computer software which is essential to start up and run the core programs of a system. 'Information technology software' is essential for smooth running of the business activities of the user. Thus the clients of the appellant in this case would be users of 'information technology software' ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
