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2015 (6) TMI 161 - AT - Service TaxClassification of service - appellants have website where a number of photographs are available for a viewer to see and choose from the same after browsing - whether the services rendered by the appellant would fall under the category of Online information and Data base access or Retrieval service under Section 65 (75)(zh) or otherwise - held that - on-line information means providing data or information which is retrieved or otherwise in electronic form through a computer network. It is an admitted fact in the case in hand, that the appellant s client has an access to the image or photograph, which he want to download for the purposes either to place an ad or for research can be done so only through the computer network. Further, we find that the appellant s website allows the access and retrieve the data or information contained therein which are free for the purpose of viewing on the monitor, but has to be paid for downloading in the for further commercial use. - database or the information which is accessed need not be only photograph, it can be strategic, legal and having data wherein graphics are displayed, books and other electronic publications etc. The service as rendered by the appellant would be web-based service providing access or downloading of a digital content inasmuch as the images and photographs are nothing but a digital content stored in website. - impugned order of the first appellate authority is correct and does not require any interference - Decided against assessee.
Issues:
1. Classification of services under the category of 'Online information and Data base access or Retrieval service' for a website offering photographs for viewing and downloading. Analysis: The appeal challenged an Order-in-Appeal regarding the classification of services provided by the appellant's website. The appellant allowed viewers to browse and view photographs for free but required an agreement and payment for downloading. Revenue authorities categorized the service under 'Online information and Data base access or Retrieval service,' leading to the appeal. The appellant contended that the service did not fall under this category due to restrictions on usage and copyright ownership over the photographs. The Counsel for the Appellant argued that the specific restrictions imposed by the appellant on photograph usage meant the service should not be classified as 'Online information and Data base access or Retrieval service.' They referenced invoices and previous Tribunal judgments to support their position. The Departmental Representative, however, maintained that since clients accessed and downloaded photographs through a computer network, it qualified as such a service. Upon careful consideration, the Tribunal analyzed the definition of 'on-line information and data base access or retrieval' under Section 65(75)(zh) of the Finance Act, 1994. The Tribunal noted that the appellant's service allowed clients to access and retrieve data electronically through a computer network, supporting the classification under the said category. The Tribunal emphasized that while the photographs may have copyright, the main activity was providing information for retrieval. Additionally, the Tribunal highlighted that the service was not limited to photographs but could include various digital content accessible on the website. They referenced an unreported High Court judgment to emphasize that the consideration paid for accessing and downloading digital content constituted a service falling under the defined category. The Tribunal dismissed the appellant's reliance on previous Tribunal judgments, distinguishing the nature of services provided in those cases from the present scenario. Ultimately, the Tribunal upheld the Order-in-Appeal, concluding that the services provided by the appellant fell under the category of 'Online information and Data base access or Retrieval service' as per the Finance Act, 1994. In conclusion, the Tribunal rejected the appeal, affirming the classification of the appellant's services and the correctness of the Order-in-Appeal.
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