TMI Blog2023 (10) TMI 432X X X X Extracts X X X X X X X X Extracts X X X X ..... that during international roaming the subscriber of the home telecom operator is the service receiver. During international outbound roaming outside the taxable territory the HNO is the service recipient of the services provided by the FTO and not the HNO s subscribers/ customers. The averment of the appellant in this regard hence succeeds. The reliance placed by Revenue on the minority order and Board s Education Guide has been examined by the majority decision in the same judgment and has not found favour for reasons stated therein. Whether the activity undertaken / provided by the FTO to the HNO is exigible under RCM? - HELD THAT:- The issue as to whether the appellant is liable to pay service tax under RCM on outbound roaming services received from the foreign telecom service provider under the category of telecommunication services was examined by a coordinate Bench of this Tribunal in Vodafone Essar Digilink [ 2017 (5) TMI 882 - CESTAT NEW DELHI] - the Division Bench concluded that services provided by any person who is not a telegraph authority is not liable to discharge service tax either under section 66 or under section 66A of the Finance act 1994. Although ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s. Krithika Jaganathan, learned counsel appeared before us for the appellant and Smt. Anandalakshmi Ganeshram, learned Superintendent (AR) appeared for Revenue. 4.1 The learned counsel for the appellant submitted that they hold a license under the Indian Telegraph Act,1885 ( Telegraph Act ) for providing cellular/ mobile services to its subscribers within a circle . The Appellant (Home Network Operator i.e. HNO ) had executed arrangements with Foreign Telecommunication Operators (FTO) to enable international roaming services whereby a subscriber of the appellant who travels outside India (and hence outside the appellant s network) would be able to use the network of the FTO for the duration of their trip and receive seamless service. She stated that service tax liability on international outbound roaming services received by a HNO from a FTO under Telecommunication Services has been held to be not sustainable by a Coordinate Bench of this Tribunal in M/s Vodafone Essar Digilink Ltd Vs CCE Jaipur I [2017 (5) TMI 882 CESTAT NEW DELHI] dated 30/11/2016. It was held that since the FTO is not granted with any licenses under the Indian Telegraph Act, they cannot be considered as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r. 5. We have gone through the appeals and have heard the rival parties. The dispute relates to exigiblity of international outbound roaming service. 5.1 The impugned period for which tax has been demanded is from 01/10/2007 to 30/06/2012 pertains to the pre-negative list period i.e prior to 1.7.2012. The primary issues to be decided for the resolution of the dispute are: i) As per the impugned facts, who is the recipient of service provided by a FTO to a cellular / mobile subscriber of an HNO, during international roaming? As per the appellant they (HNO) receives the service from the FTO and not the appellants subscriber during periods of his international outbound roaming. Revenue on the other hand is of the view that the FTO is only an intermediary and service is rendered by the HNO to their subscriber who is on international outbound roaming. ii) Whether the activity of providing cellular / mobile services to a subscriber during international outbound roaming relates to the taxable service of BAS defined as per section 65(19)(vi) of FA 1994 as claimed by Revenue or to TCS as per section 65(109a) of Finance Act, 1994 as averred by the appellant. iii) Whether the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under the Education Guide that the lady who owns the car and leaves at the garage for servicing, later when her chauffer collects the serviced car after making payment on behalf of the lady, cannot be called the service receiver. Undoubtedly, the service receiver is the lady, not the chauffer, who makes the payment, for the simple reason that she is the person legally entitled to receive the service. In other words, the decisive factor, is the agreement between the service station and the lady for servicing the car, under which she is obliged to make the payment in consideration of the service received. The mode/medium of payment of the obliged amount may be through the Chauffer. Thus, the illustration makes it clear, to identify the service receiver, who makes the payment for the service, is a factor immaterial, but who is legally obliged to make the payment, in pursuance to the agreement for rendition of the service, is the decisive factor. Examining the issue other way round, legally, if any deficiency in the service of the car, the lady can proceed against the service provider and not the chauffer who has made the payment on behalf of the lady, while taking delivery of the car. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... issue is with regard to the demand of service tax under Business Support Services . The demand has been confirmed on the activity of International Outbound Roaming services received by the appellant from Foreign Telecom Operators abroad. The Department alleges that the Foreign Telecom Operators have rendered Business Support Services to the appellant. The demand under this category is incorrect. The cellular mobile telephone services including provision of access to and use of switched and non-switched networks for the transmission of voice, data and video, inbound and outbound roaming services to and from national and international destinations were introduced as Telecommunication Services with effect from 01.06.2007. Therefore, the very same activity cannot be made liable to service tax under a different heading viz., Business Support Services for the same period. **** ****** ******* ****** 7.1 The second issue pertains to the demand of service tax under Business Support Services for the period 2007-09. Telecommunication Services have been brought into the service tax net with effect from 01.06.2007, which includes the activity of international access and use of in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In other words, although the activity of providing cellular / mobile services to a subscriber during international outbound roaming relates to telecommunication service, however the said services provided by any person who is not a telegraph authority , as in the present case, the activity would not be a taxable service as defined by section 65(109a) and is hence not exigible to service tax at the hands of the appellant under RCM. Maintaining judicial discipline, we concur with the same. 9. We now summarise our findings as under: i) During international outbound roaming the HNO (appellant) is the service recipient of the services provided by the FTO and not the HNO s subscribers/ customers. ii) The activity of providing cellular / mobile connectivity from outside the country to a subscriber of a HNO during international outbound roaming , relates to telecommunication service . iii) Although the activity of providing cellular / mobile services to a subscriber during international outbound roaming relates to telecommunication service, however the said services provided by any person who is not a telegraph authority , as in the present case, the activity would not ..... X X X X Extracts X X X X X X X X Extracts X X X X
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