2015 (7) TMI 234 - AT - Service Tax

Commission agent service - Applicability of Section 66A - whether the lower authorities are correct in holding that the commission agent service received by the appellant is covered under Section 66A for discharging the service tax liability by the recipient on reverse charge basis - Held that - From the Rule 3(iii)(c), it is clear that the service of overseas agent received by the appellant has been provided from outside India and received by the appellant who is a recipient located in India and the service is used in relation to business or commerce i.e. export business. Therefore, in view of this undisputed position. Section 66A is clearly applicable and according to which the appellant was legally liable for payment of service tax for the period from 19.4.2006. In view of this, the lower authorities have correctly held that the service tax was payable after 19.4.2006 and rightly rejected the refund claim in respect of service tax paid for the period on or after 19.4.2006. I am, therefore, fully in agreement with the findings of the lower authorities. - Decided against assessee.

Summary

Issues:
Refund claim rejection based on service tax paid to overseas commission agent under reverse charge mechanism for export of goods.

Analysis:
The appellant filed refund claims for service tax paid on commission to overseas agent under reverse charge mechanism for export of goods. Original authority partially approved the claim. Commissioner (Appeals) rejected the appeal leading to the current appeal. No representation by the appellant was made during the hearing. The Revenue argued that the service falls under Section 66A as service received in India for business use. The Tribunal analyzed the service tax rules and found that the service provided by the overseas agent was received in India by the appellant for export business, making it taxable under Section 66A. The Tribunal agreed with the lower authorities' decision to reject the refund claim for service tax paid after 19.4.2006. Therefore, the impugned order was upheld, and the appellant's appeal was dismissed.

Conclusion:
The Tribunal affirmed that the service provided by the overseas agent to the appellant, received in India for business purposes, was subject to service tax under Section 66A. The appellant's refund claim for service tax paid after 19.4.2006 was rightly rejected by the lower authorities. The appeal was dismissed, and the impugned order was upheld.