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TMI Blog2017 (8) TMI 1233X X X X Extracts X X X X X X X X Extracts X X X X ..... he premises stated hereinabove, the appellant submits that the following question of law arises for determination by this Hon'ble Court: (a) Whether the services provided by the Respondent herein, in accordance with various contracts entered into with overseas manufacturers, is classifiable under "Business Auxiliary Services" as defined under section 65(105)(zzb) of the Finance Act, 1994 and if so, whether the said services provided are to be treated as export of services or not? (b) Whether the CESTAT was justified in passing the impugned order dated 07.01.2015 relying upon several judgments of the tribunal which are not applicable in the facts and circumstances of the present case?" 4. We have to consider the rival submission keepi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s to the customers of foreign telecom service provider when he is in India and using the appellant telecom networks. Revenue held a view that the consideration for services rendered in India is taxable under Business Auxiliary Service. The Bench after considering the provisions of "Export Services Rules" and Board clarifications, and the decision of Microsoft Corporation (I) Pvt. Ltd. Case held in favour of the assessee by recording as under: "54. In view of the above, the difference of opinion on various points is resolved as under: (i) That the business auxiliary services of promotion of market in India for foreign principal made in terms of agreement dated 01/07/2005 amount to Export of Services and the Hon'ble Supreme Court decisi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es, the same are not liable to be sustained against the appellants." 6. The CESTAT, after recording above has also noted the provisions of law and the judgments read and referred by the parties in this regard. The finding recorded in paras 10 and 11: "10. In case of Paul Merchants Ltd. Case there was a difference of opinion between the Hon'ble Member (Judicial) and the Hon'ble Member (Technical) which was referred to 3rd Member held in favor of the assessee and by a majority order it was held that: "The point of difference as mentioned in Para 60 of the referral order has been answered by third Member as under: "In view of the above discussion, the points of difference, mentioned in para 60 are answered as under: (i) The term " ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d judgments that Service Tax is a value added tax, which in turn is a destination based consumption tax in the sense that it is levied on commercial activities, and it is not a charge on the business but a charge on the consumers. There is nothing in Export of Service Rules, 2005 which can be said to be contrary to the principle that a service not consume din India is not be taxed in India. In yet another case of Microsoft corporation (I) Pvt. Ltd., also ended up with a difference of opinion on similar facts by majority decision, issue was held in favor of the assessee". 11. In the recent case of GAP International Sourcing (India) Pvt. Ltd. (supra) the coordinate Bench of this Tribunal held in favour of the assessee wherein the facts wer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al holds that the benefit of the services accrued to the foreign clients outside India. This 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. v. 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 d ..... X X X X Extracts X X X X X X X X Extracts X X X X
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