9911796707
TMI Blog2008 (8) TMI 191X X X X Extracts X X X X X X X X Extracts X X X X ..... al requirements to provide voice, video and data communication services to Andhra Pradesh Technology Services Ltd. (APTS) user organization which includes Government of Andhra Pradesh, State Public Sector Undertakings, local bodies in Andhra Pradesh and other autonomous and semi autonomous organizations set up by the Government and private organizations for interactions with the Government. The point at issue is whether the appellant is liable to pay Service Tax under the category of 'Online Information and Database Access and/or Retrieval Service'. On the basis of the documents, revenue came to the conclusion that the appellant would be liable for Service Tax under the above category. Hence, proceedings were initiated against them by way of issue of the show cause notice. On consideration of the submissions made by the assessee, the Commissioner came to the conclusion that the appellants provided "Online Information and Database Access or Retrieval" services defined under Section 65 (75) of the Finance Act, 1994 and therefore, they would be liable for the Service Tax. Consequently, the learned Commissioner has confirmed the demand of Rs. 88,66,501/- for the period from 16. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... affic. But, highway authority does not either set up destination or permit or control the traffic. Similarly the noticee does not put up for control data or voice traffic over APSWAN. It was also stated that in the definition of 'taxable service' in Section 65 (105) ZH "in relation to" cannot be widely interpreted. In the context of other services, this phrase has been read narrowly and they rely on the following decisions. a. CCE Vs. Team UPD Ltd. - 2005 (179) ELT 469 (T). b. CCE Vs. Azad Publications - 2004 (167) ELT 59 (T.-Del.) c. Star Neon Sign Vs. CCE - 2002 (49) RLT 541 (CEGAT-Del.) = 2002 (141) ELT 770 (T.-Del.) d. CCE Vs. The Incoda - 2004 (64) RLT 420 (CESTAT-Kol.) = 2004 (174) ELT 65 (T-Kol.) e. Advertising Club Vs. CBE & C - 2001 (131) ELT 35 (Mad.) f. Zodiac Advertisers Vs. CCE, Cochin - 2006 (75) RLT 784 (CESTAT Ban.) = 2006 (3) STR 538 (T-Bang.) in the context of advertising services. Printing of ad materials, leasing land for hoardings, hiring of display space for ads not taxable services. g. L & T Ltd. Vs. CC - 2006 (75) RLT 186 (CESTAT-LB) = 2006 (3) STR 321 (T-LB) in the context of C & F Services. Procurement of orders not C & F Services. 5.2 It w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er one is the software to carry out the operation of the access of database with the aid of the network. Both have to go hand in hand and if one of them fails the access is not possible. Hence, without having to go into the meaning of any of the complex terminologies it plainly follows that providing access to information or data through a medium or network is a service and the services rendered by the appellant would squarely fall within the ambit of "Online Information and Database Access or Retrieval Service". 6.2 Reference was made to the Board's Circular dated 9.7.2001 [reported in 2001 (45) RLT M55] wherein the Board has stated that internet service providers would be covered under the "Online Information and Database Access and Retrieval services". It was stated that by drawing reference to Board's Circular, the Original Authority has only drawn the attention of the appellant to the similarity in the nature of the services of internet service providers and those of the appellant. It is not the contention of the revenue that the appellant is an internet service provider. It has been opined by drawing analogy to Board's Circular that the nature of the activity car ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ract, we can cull-out the responsibility of the appellant. It is seen that the entire network is not provided by the appellant. What the appellant is providing to the Andhra Pradesh Government is given in Annexure-1 of the Contract. They are as follows: 1. Multi-services switch 2. Routers 3. Firewall 4. Network Management 5. Accounting Service All the equipments are placed in the physical locations called DNCs (District Networking Centres) in the districts and SNC (State Networking Centre) in Hyderabad. Annexure-1 to the Contract further gives the functional requirements and capacity requirements of the various equipments. We need not go into all that. The point is that the appellants have to provide all these equipments which are nothing but the network interfaces. 7.2 Secondly, the appellant is responsible for keeping up the uptime. Uptime means the duration when the equipments work without fail. So the responsibility of the appellant is keeping all the elements (ports, connected in the network, they have to function properly) in working condition. The standards are given in Annexure-II. It is also seen that the equipments are connected by leased line. The Andhra Pradesh g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment supplied by them. Moreover, the data is generated only by the Andhra Pradesh Government and the same is being used by the different wings of the Government, therefore, the appellant has also not provided any data. The responsibility of the appellant is to see that the network (WAN) functions. This cannot be equated with "Online database access/retrieval services". Hence, we cannot understand how the Commissioner has come to the conclusion that the appellant provides this service. The Commissioner's reference to Board's Circular with regard to internet service provided is not at all correct. In our view, the said Circular is not relevant and the services provided by the appellant are not similar to those provided by the internet service provider. In this connection, we would like to refer to another taxable service introduced with effect from 1.7.2007, it is called "Telecommunication Service". On going the definition of the Telecommunication Service as per Section 65 (109A), it includes among other things. * Private network services including provision of wired or wireless telecommunication link between specified points for the exclusive use of the clients; * Data tra ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
