2015 (7) TMI 757 - AT - Service Tax

Demand of service tax - Consulting Engineering services - Payment made for technical know how service - Held that - customer had certified that the payment was made for the purpose of technical know-how. The Revenue has not disputed the authenticity of the certificate at any point of time. No enquiry was conducted by the Department in respect of this certificate. Hence, there is no reason to dis-believe this certificate. The Tribunal in the case of Indo Nippon Chemicals Co. Ltd Vs CCE Vadodara - 2009 (4) TMI 140 - CESTAT AHMEDABAD held that the demand based on assumptions and presumptions under the category of Consulting Engineer service cannot be sustained. It is observed by the Tribunal that the Appellant produced the certificate that they received the amount of technical know-how. In the present case, there is no material available that the Appellant rendered Consulting Engineer Service - impugned order is set aside - Decided in favour of assessee.

Summary

Issues:
Demand of Service Tax for Consulting Engineering services for the period 1998-99.

Analysis:
The Tribunal was presented with the issue of a demand for Service Tax amounting to Rs. 77,150.00 for Consulting Engineering services during the period of 1998-99. The matter was remanded to the Commissioner (Appeals) previously to determine the liability of the Appellant. The Appellant provided a certificate from M/s Textile Industries Ltd dated 12.04.2005, confirming payment received for technical know-how. The Revenue argued that the Appellant failed to produce relevant documents supporting the technical know-how service and did not present a formal contract or agreement outlining the terms of intellectual property transfer.

The Tribunal disagreed with the findings of the Commissioner (Appeals) based on the evidence presented. It noted that the customer's certificate attesting to the payment for technical know-how was unchallenged by the Revenue, and no investigation was conducted regarding its authenticity. Referring to a precedent, the Tribunal emphasized that demands relying on assumptions and presumptions for Consulting Engineer services are unsustainable. It highlighted the absence of evidence indicating that the Appellant provided Consulting Engineer services, as the payment was clearly linked to technical know-how.

Consequently, the Tribunal set aside the impugned order and allowed the appeal filed by the Appellant. The decision was made based on the lack of evidence supporting the demand for Service Tax under the category of Consulting Engineering services, as the payment was specifically for technical know-how according to the certificate provided.