2017 (2) TMI 947 - AT - Service Tax

Commission - services provided in Nepal and Bangladesh - whether taxable or not? - Held that - the demand of ₹ 27,629/- has been confirmed on account of an error of fact on the part of Commissioner (Appeals) - the demand for 01.07.2003 to 19.11.2003 pertains to the commission received in respect of services provided in Nepal and Bangladesh and not to J & K - the order of Commissioner (Appeals) to the extent it pertains to confirmation of demand of ₹ 27,629/- is set aside - appeal allowed - decided in favor of appellant.

Summary

Issues:
Appeal against Order-in-Appeal regarding service tax demand for promotion and marketing services provided to a foreign company in India and Nepal.

Analysis:
The appeal was filed against the Order-in-Appeal passed by the Commissioner of Central Excise (Appeals), Chandigarh-I, demanding service tax from the appellants for services provided to a foreign company for promoting and marketing their goods in India and Nepal. The initial demand was for ?22,76,633/- and ?5,08,355/-, which was later reduced by the Commissioner (Appeals) to ?27,629/-, related to services provided in Jammu & Kashmir. The appellants contested this demand, arguing that the amount in question actually pertained to services provided in Nepal and Bangladesh, not Jammu & Kashmir. The Tribunal noted the error in the Commissioner's order, as evidenced by a table showing the demand for the period in question related to Nepal and Bangladesh. Consequently, the Tribunal set aside the demand of ?27,629/-, allowing the appeal in favor of the appellants.

In conclusion, the Tribunal found that the demand of ?27,629/- confirmed by the Commissioner (Appeals) was based on a factual error, as the services in question were provided in Nepal and Bangladesh, not in Jammu & Kashmir. Therefore, the Tribunal set aside the part of the Commissioner's order related to this demand and allowed the appeal filed by the appellants.