9911796707
TMI Blog2019 (10) TMI 617X X X X Extracts X X X X X X X X Extracts X X X X ..... question: What is the correct Service Accounting Code (SAC) for the services mentioned below in terms of Notification No. 11/2017-Central Tax (Rate) dated 28th June 2017? a. IT Support Services b. IT Managed Services 3. The applicant furnishes some facts relevant to the stated activity: a. The applicant states that he is a 100% subsidiary of Dimension Data Asia Pacific Pte Ltd (herein after called "DDAPPL") based in Singapore. The ultimate parent company is NTT, a company incorporated and listed in Japan. b. The Company has been set up in Milestone Buildcon IT SEZ in Bangalore falling under the jurisdiction of Cochin SEZ with their letter of Approval dated 07.07.2017. c. The applicant is engaged in providing IT Technical and Support Services and IT Managed Services to its group entities located outside India. The Company has commended its operations on 15.12.2017. d. The services provided by the company to the entities situated outside India qualifies as 'zero-rated supply' under section 16 of the IGST Act, 2017. e. The details of the services for which the advance ruling is sought is as follows: i. Support Services: This is sub-classified into two types of servic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d 28th June 2017 as amended from time to time. He also has further referred to the explanatory notes to the schemes of classification of services. Based on the above, the applicant has tabulated key categories under which the services may be classified as follows: Chapter/Section/Heading/Group Service Code (Tariff) Description of Services Rate of tax Heading 9983 Other Professional, technical and business services Group 99831 Management consulting and management services including financial, strategic, human resources, marketing, operations and supply chain management 18% 998313 Information technology consulting and support services 18% 998314 Information technology (IT) design and development services 18% 998315 Hosting and information technology infrastructure (IT) infrastructure provisioning services 18% 998316 Information technology infrastructure and network management services 18% Heading 9987 998713 Maintenance and repair services of computers and peripheral equipment 18% The applicant states that it is evident from the above list of classifications that the rate of tax applicable to his servi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... well-established principle in taxation jurisprudence for resolving classification disputes that a specific entry shall prevail over a general entry. In this regard, the applicant places reliance on the judgements of the Hon'ble Supreme Court of India in the case of Western India Plywoods Ltd. V. Collector of Customs, Cochin [2005 (188) ELT 365 (SC)] = 2005 (10) TMI 90 - SUPREME COURT and in the case of Superintendent of Central Excise and Others v. Vac Met Corporation Ltd. [1985 (22) ELT 330 (SC)] = 1985 (8) TMI 381 - SUPREME COURT. (b) In relation to Support Services: The applicant states that as per the description of services relating to support services stated earlier, it is evident that the services rendered by the applicant viz. Support Services relates to the provision of information technology software services. The Notification under paragraph 4 defines Information Technology Software as under: "4. Explanation. - For the purposes of this notification, - (v) "information technology software" means any representation of instructions, data, sound or image, including source code and object code, recorded in a machine readable form, and capable of being manipulated or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce to the same provisions under the KGST Act. 6.1 The description of services which are provided by the applicant have been examined with reference to the details provided by the applicant. The classification tariff entries 998313 and 998316 have also been verified and the following points are noted: (a) The Service Accounting Code 9983 is considered first. Section 8 deals with the Business and Production Services and there is no dispute that the services provided by the applicant fall under this category. The services provided are not covered under Heading 9981 (relating to Research and Development Services) or 9982 (relating to Legal and Accounting Services). Hence it gets covered under the Heading 9983 which is related to Other Professional, technical and business services and there is no dispute in this matter. (b) The matter before the Authority is there are two types of services provided by the applicant, one is of support services and the other is infrastructure and network management services and the applicant desires to know the correct classification. The Groups falling under Heading 9983 are perused and the following is noted: a. Group 99831 deals with Management ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hardware or an entire computer system, such as provision of customer support in using or troubleshooting the software, upgrade services and the provision of patches and updates, provision of customer support in using or troubleshooting the computer hardware, including testing and cleaning on a routine basis and repair of IT equipment, technical assistance in moving a client's computer system to a new location, provision of customer's support in using or troubleshooting the computer hardware and software in combination; iii. providing technical expertise to solve specialized problems for the client in using a computer system, such as auditing or assessing computer operations without providing advice or other follow-up action including auditing, assessing and documenting a server, network or process for components, capabilities, performance, or security; iv. data recovery services, i.e. retrieving a client's data from a damaged or unstable hard drive or other storage medium or providing standby computer equipment and duplicate software in a separate location to enable a client to relocate regular staff to resume and maintain routine computerized operations in event of a disaster ..... 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