TMI Blog2016 (12) TMI 165X X X X Extracts X X X X X X X X Extracts X X X X ..... o a person who has place of business, fixed establishment, permanent address or usual place of residence, in India. In such case taxable service shall be treated as having been rendered by the Service recipient. Further we find that Rule 3 of Taxation of Services (Provided from Outside India and received in India) Rules, 2006 deals with the situation involved in present case i.e Taxable services provided from outside India and received in India. Prima facie it seems that the case in hand is covered by the provisions of Section 66A and Rule 3 supra. However we find that the order passed by the refund sanctioning authority as well as first appellate authority have not verified the vital facts as above. We are of the prima facie view that in case the service received by the person situated in India from the persons situated outside India would be liable for tax. In the present case the goods were cleared from a foreign country to another foreign country but the services related to such transaction was received by the Appellant who has permanent place of business in India and in whose names the bills were raised and who made the payment in foreign exchange. It is identical to case whe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for attending company s matter in foreign country, Professional charges, Service Charges for services performed outside India, advertisement expenses displayed in foreign country, Registration consultancy and registration of products in foreign country, Rent on immovable property etc. The Appellant in the year 2012 paid the service tax on such charges for the period 01.10.2007 to 31.12.2012 alongwith interest. This amount of ₹ 7,85,13,768/- inclusive of interest was paid vide different challans. The Appellant thereafter on 01.04.2013 filed refund claim of aforesaid amount so paid on the ground that the services were rendered outside India and received outside India and hence not liable to service tax as the provisions of Section 64 of the Finance Act, 1994 deals with service tax extends to territory of India only. That the service providers are located outside India. The services were provided from outside the territory of India and the services are utilized outside the India. As such the services provided by persons/ entities located out of India and performed/ used out of India are not subject to service tax. The Assistant Commissioner sanctioned the claim on the gro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Vinay Jain, Ld. C.A appearing for the Appellant submits that the services were rendered/ performed outside India in relation to sale of goods outside India and hence not chargeable to Service Tax in terms of Finance Act, 1994 as the provisions of the Act in terms of Section 64 are not applicable beyond India. All the services were rendered and consumed outside India, such services cannot be taxed in India. Service tax is destination based consumption tax. He relies upon the judgment of Hon ble Apex Court in case of Ishikawajna - Harima Heavy Industries Ltd. Vs. Dir. Of Income Tax 2007 (6) STR 3 (SC) to support his contention that tax cannot be levied without sufficient territorial nexus. He also relies upon the judgments in case of Commissioner of Income Tax, Bombay Vs. Ahmedbhai Umarbhai Co. Bombay 1950 (SCR) 335, Bengal Immunity Co. Ltd. Vs. State of Bihar (1955) 2 SCR 603, Cox Kings Vs. CST New Delhi 2013 - TIOL - 1907 - CESTAT - DEL, SBI Cards and Payment Services Pvt. Ltd 2016 - TIOL - 38 (CESTAT - DEL) . He submits that the services availed by them are in relation to sale of product in respective countries and are not for any business in India. The goods sold are ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Vs. CCE, PUNE - III 2015 (38) STR 1200 (TRI) and Paul Merchants Ltd. Vs. CCE, Chandigarh 2013 (29) STR 257 (TRI) in support of his submission. 5. We have carefully considered the submissions made by both the sides and perused the case records. 6. We find that in the instance case the Appellant have received services from entities located outside India in respect of sale of goods outside India. We find from the submission and Paper book filed by the Appellant that the Appellant were mainly buying the goods from china or other countries and selling the same to third country. The Appellant s China office is coordinating the various activities to and on behalf of Appellants and have fiscal representative in countries where the sales are made. The Appellant in relation to such transactions are receiving services from different service providers. We find from the Paper book that the bills for such services are raised by the Service provider in the name of Appellant at their Head office at Mumbai for which the Appellant have paid to the service providers in foreign exchange. The scanned copy of sample bill is as below : 7. We also find from the order of the Appellat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gn exchange. It is identical to case where the goods are exported outside India but the services related to such exports are availed from the overseas service provider such as commission agent etc.. In all such cases the service recipient in India i.e Exporter is liable to service tax. However all these aspects have to be gone into factually. To ascertain the status of the Appellant as the service recipient, it is necessary to verify the bills and invoices raised by the service providers, payment transaction therefore, treatment of the payment transaction in the books of accounts of the Appellant. Further application of the ratio of the judgments cited by the Appellant can only be decided only after the verification of the entire transactions. 9. As regards unjust enrichment, it is observed from the finding of the original authority that he has not verified the books of accounts of the Appellant and relied upon the submission made by the appellant in this regard and chartered accountant s certification. It is incumbent on the adjudicating authority to verify from the books of accounts to ascertain the fact whether the incidence of service tax paid by the appellant has not b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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