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2023 (4) TMI 546 - AT - Service TaxLevy of service tax - dealings on a species of Digital Signature Certificate - demand under four different taxable service categories, for different period - HELD THAT - In the matter of SIFY TECHNOLOGIES LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE SERVICE TAX, LTU, CHENNAI 2018 (6) TMI 644 - CESTAT CHENNAI the co-ordinate bench of the Tribunal was confronted with the issue of providing Secured Socket Layer Certification (SSLC) and Digital Signature Certificate being an IT service from 16.05.2008 onward or not and whether the same were Development of Content Service or Business Support Service for the earlier period. After considering the entire gamut of services as well as CBEC clarification bearing F. No. 137/76/2008-CX4 dated 05.06.2008 and F. No. 137/76/2008-CX4 dated 28.07.2008, the bench concluded that the services involved are not taxable services of the nature sought by the department and simply usage of some software by the party in India would not amount to activities coming under the preview of information technology services. The Sify Order extensively covers the rejection of the activities for service tax under the heads purposed by the department in the instant case also, and even for the same periods. Thus, activities of the appellants are not covered under various heads proposed by the department - appeal allowed.
Issues:
The issues involved in the judgment are the demand of Service Tax on SSL certificate services provided by the Appellant, the distinction between SSL certificates and Digital Signature Certificates, and the applicability of different service categories for taxation. Summary: Issue 1: Demand of Service Tax on SSL Certificate Services The Appellant, providing SSL certificate services to M/s Entrust Limited, Canada, was dissatisfied with the Order in Appeal passed by the Commissioner (Appeals) demanding Service Tax under different service categories for the same activity. Despite the Appellant's submissions clarifying SSL certificates as digital signature certificates not subject to Service Tax, the impugned order confirmed the demand. The Appellant appealed the decision, citing precedents like Total Environment Building Systems P.Ltd. and L&T Ltd to support their argument against multiple taxation for the same activity. Issue 2: Distinction between SSL Certificates and Digital Signature Certificates The Appellant argued that SSL certificates are voluntarily acquired while digital signature certificates are statutorily recognized, emphasizing that the services provided were for due diligence of Indian buyers desiring SSL certificates. The Appellant highlighted the difference in the nature of services provided compared to digital signature certificates, supported by the Board's clarification. The Appellant's advocate compared the factual matrix with the Sify case to demonstrate the non-taxable nature of SSL certificate services. Issue 3: Applicability of Different Service Categories for Taxation The Department contended that SSL Certification involves a more elaborate process than digital signature certification, categorizing the services as Business Support Services to M/s. Entrust Limited, Canada, and seeking confirmation of the Order-in-Appeal. However, the Tribunal, referencing the Sify case, concluded that the activities of the Appellant did not fall under the taxable services proposed by the Department. The Tribunal allowed the appeals, applying the ratio of the Sify decision to grant consequential relief to the Appellant. This judgment highlights the importance of understanding the nature of services provided and the applicability of taxation based on clear distinctions between different types of certificates and services rendered.
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