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2013 (8) TMI 454 - AT - Service TaxAd-hoc Exemption order No.1/1/2010-ST - Online Information or Database Access or Retrieval Service (OIDARS) - Business Support Service (BSS) - Sale of Space or Time for Advertisement on Internet - Revenue considered that these taxable services were provided or received as the case may be by the assesse and in respect whereof the liability to remit tax arises Held that - Prima facie the contention urged on behalf of the petitioner was well founded Service recipient when liable to pay service tax u/s 66A shall be considered as the service provider should apply in terms to the ad-hoc exemption order as well - Under Section 66A of the Act, where any service specified Section 65 (105) was provided by a person, of the description specified in clauses (a) and (b) of sub-section (1) thereof, such service shall, for the purposes of the section, be the taxable service and such taxable service shall be treated as if the recipient had himself provided the service in India and accordingly all the provisions of Chapter shall apply pre-deposits were waived - stay granted.
Issues involved:
1. Waiver of pre-deposit and grant of stay proceedings sought by the appellant in response to an adjudication order for recovery of service tax, interest, and penalties. 2. Classification of services provided by the appellant under Online Information or Database Access or Retrieval Service (OIDARS), Business Support Service (BSS), and Sale of Space or Time for Advertisement on Internet. 3. Interpretation of legislative provisions regarding tax liability under Section 66A of the Finance Act, 1994, and its applicability to exemption orders. 4. Dispute over the liability for remitting tax on Business Support Service (BSS) under Section 65(104c) of the Act. 5. Assessment of tax liability for Sale of Space and Time for Advertisement Service. 6. Granting waiver of pre-deposit and stay of further proceedings based on the analysis of tax liabilities under different service categories. Detailed Analysis: 1. The appellant, a news agency, faced proceedings for recovery of service tax, interest, and penalties for failing to remit tax on services classified as OIDARS, BSS, and Sale of Space or Time for Advertisement on Internet. The appellant contested the classification of services but did not dispute the tax liability under OIDARS as determined by the adjudicating authority. 2. Regarding OIDARS, the appellant claimed immunity from tax liability based on an ad-hoc exemption order dated 06-09-2010, issued by the Government of India. The adjudicating authority rejected this claim, stating that the appellant, as a service recipient, is liable to pay tax under Section 66A of the Act, and thus, the benefits of the exemption order do not apply. 3. The appellant argued that the legislative fiction under Section 66A, treating a service recipient as a service provider for tax purposes, should also apply to the exemption order. The Tribunal found this contention well-founded, emphasizing that the legislative fiction extends to all provisions of Chapter V of the Finance Act, 1994, including Section 93. 4. The tax liability on BSS was disputed by the appellant, who argued that the services provided by overseas freelance stringers did not fall under the definition of Business Support Service. The appellant relied on legal principles such as Noscitur a Socii for interpreting the definition of BSS, highlighting an evenly balanced argument awaiting final disposal. 5. The appellant did not contest the tax liability for Sale of Space and Time for Advertisement Service at the present stage but reserved the right to challenge it later. The appellant also mentioned a partial remittance already made, seeking credit for the amount paid. 6. After analyzing the tax liabilities under different service categories, the Tribunal granted waiver of pre-deposit and stayed further proceedings on the condition that the appellant remits a specified amount within a deadline. The Tribunal found no liability for tax on OIDARS, an evenly balanced case for BSS, and no challenge for Sale of Space and Time for Advertisement Service at that stage. 7. The stay application was disposed of accordingly, providing relief to the appellant while ensuring compliance with the specified conditions and deadlines.
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