2013 (4) TMI 460 - AT - Service Tax

Services received from overseas agent for procuring export orders - demand dropped by the adjudicating authority for the period upto 18.04.06 in terms of the decision in the case of Indian National Ship Owners Association (2008 (12) TMI 41 - HIGH COURT OF BOMBAY) - Revenue appeal as that the Indian National Ship Owners Association s judgement has not been accepted and subsequent judgement in the case of Bhandari Hosiery Export Ltd. which rejected has been upheld by the Hon ble Supreme Court 2010 (10) TMI 907 - SUPREME COURT which has not been accepted by the Revenue and the review petition is being filed there against - Held that - It is seen that subsequently Board s letter F.No.276/8/2009-CX8A issued on 26.09.11 which observed that the appeals filed by the Revenue against the various orders of the courts/Tribunal, for defending levy of service tax on services received from outside India stands dismissed. Further, the review petition filed by the Revenue in the case of Bhandari Hosiery Export Ltd. has also been dismissed by the Hon ble Supreme Court 2013 (4) TMI 204 - SUPREME COURT as observed in the said letter. After taking into consideration the entire developments, the Board has observed that in view of the aforesaid judgement of the Hon ble Supreme Court, the service tax liability on any taxable service provided by a non-resident or a person located outside India to a recipient in India would arrive w.e.f. 18.04.06, i.e.,enactment of section 76 of Finance Act, 1994. As such it is seen that the letter of the Board issued vide F.No.276/8/09-CX8A, dtd. 26.09.11 supports the respondents case. Thus no reasons to interfere in the impugned order of the Commissioner(Appeals). Accordingly the appeal filed by the Revenue is rejected.

Summary

Issues Involved:
Appeal against demand confirmation for services received from overseas agent for procuring export orders.

Analysis:
The appeal before the Appellate Tribunal involved the Revenue challenging the dropping of proceedings against the respondents for confirming demand related to services received from an overseas agent for procuring export orders. The original adjudicating authority had dropped the proceedings based on a decision of the Hon'ble Bombay High Court in a specific case. The Revenue contended that the judgment of the Indian National Ship Owners Association was not accepted and referred to a subsequent judgment of the Hon'ble Punjab & Haryana High Court in the case of Bhandari Hosiery Export Ltd., which was upheld by the Hon'ble Supreme Court. The Revenue mentioned that a review petition was being filed against the judgment.

Further developments included a letter issued by the Board on 26.09.11, which highlighted the dismissal of appeals filed by the Revenue against various court/Tribunal orders regarding the levy of service tax on services received from outside India. The letter also mentioned the dismissal of the review petition in the case of Bhandari Hosiery Export Ltd. by the Hon'ble Supreme Court. The Board, considering these judgments, observed that the service tax liability on taxable services provided by non-residents or persons located outside India to recipients in India would arise from 18.04.06, with the enactment of section 76 of the Finance Act, 1994.

The Tribunal noted that the Board's letter supported the respondents' case, and in light of the decisions and developments mentioned, there was no reason to interfere with the impugned order of the Commissioner(Appeals). Consequently, the appeal filed by the Revenue was rejected.