TMI Blog2016 (6) TMI 1108X X X X Extracts X X X X X X X X Extracts X X X X ..... whether such a service could be taxed under a different head is irrelevant and does not arise as there is no such case made out in the notice. - there can be no liability to tax under the head of IPR services in respect of an Intellectual Property Right that is not recognised by the law in India. Insofar as the agreement with Investa Technologies S.A.R.L. is concerned the same was entered into on 14.8.2004, prior to IPR services being brought into the net of service tax w.e.f 10.9.2004. The service itself having been rendered prior to the introduction of the levy, the mere fact that payments for the same were made on a staggered basis over a period of time cannot be a ground for levying service tax merely with reference to the date on which payments were being made. Further, the entire dispute being revenue neutral, there could have been no intention to evade payment of duty and consequently the extended period of limitation was per se not invokable. Demand set aside - Decided in favor of assessee. - Appeal No. ST/50/12 - Final Order No. A/88187/2016-WZB/STB - Dated:- 21-6-2016 - MR. M.V. RAVINDRAN, MEMBER (JUDICIAL) AND MR. C.J. MATHEW, MEMBER (TECHNICAL) Shri Vip ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been introduced in the Finance Act, 1994 with effect from 10.9.2004. (e) The extended period of limitation was not invokable inasmuch as the entire transaction was revenue neutral. 4. The Learned AR appearing on behalf of the revenue has reiterated the findings of the Revenue and submitted that the service were aptly classified under IPR and that the extended period of limitation has rightly been invoked. 5. We have heard the submissions of both sides. The primary issue that arises for determination is whether an Intellectual Property Right, which is not recognised under the Indian laws for the time being in force would constitute an Intellectual Property Right, the temporary transfer or the right to use or enjoyment of which is liable to tax under the head of IPR services. 6. While deciding this we have to bear in mind that India is a signatory to the Paris Convention for the Protection of Industrial Properties. The said convention was the first major step taken to help creators of intellectual property to ensure that their intellectual works were protected in other countries. In furtherance to the same a Patent Cooperation Treaty, was signed by member countries, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... suggested by the Respondent to the effect that Intellectual property right even if not recognised in India could still be taxed under the head of IPR services if taken as correct it would lead to the expression under any law for the time being in force being rendered redundant an otiose. It is a settled principle of law laid down by the Apex Court in the case of Aphali Pharmaceuticals Ltd Vs State of Maharashtra 1989 (44) ELT 613 that any interpretation which has the effect of rendering any part of the statute redundant and otiose it is to eschewed in favour of an interpretation that would harmonise the same. 9. The CBEC has also in its Circular dated 80/10/2004-ST dated 17.9.2004 was issued while explaining the scope and ambit of the different heads of taxing services which were introduced by the Finance (No.2)Bill 2004 has clarified in no uncertain terms that the phrase law for the time being in force implied such laws as are applicable in India and that IPR covered under Indian law in force were alone chargeable to service tax. It was further clarified that IPRs like integrated circuits or undisclosed information, which was not recognised under Indian laws would not be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... given under the definition such as the Trade Mark which is a right provided under Trade Marks Act. Similarly the right mentioned as design in the definition is a right under the Designs Act. Therefore we find that the technical know-how received by the Appellant and the royalty payment made by the Appellant to Unisys is nowhere established to result from the use of any Intellectual Property Right. 4.2 We may further go on to add that the Intellectual Property Right should be a right under the Indian law. Intellectual Property Right not covered by the Indian laws would not be covered under taxable service in the category of Intellectual Property Right Services. We are fortified in our view by Board Circular F. No. 80/10/2004-S.T., dated 17-9-2004 which clarified that Intellectual Property emerges from application of intellect, which may be in the form of an invention, design, product, process, technology, book, goodwill, etc. In India, legislations are made in respect of certain Intellectual Property Rights (i.e. IPRs) such as patents, copyrights, trademarks and designs. The definition of taxable service includes only such IPRs (except copyright) that are prescribed und ..... X X X X Extracts X X X X X X X X Extracts X X X X
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