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TMI Blogservice tax on ESD (electronic software distribution)X X X X Extracts X X X X X X X X Extracts X X X X ..... service tax on ESD (electronic software distribution) X X X X Extracts X X X X X X X X Extracts X X X X ..... Rajesh Rathore MPACI, Neemrana. Rajasthan, India. Reply By Seetharaman K C: The Reply: Digital distribution (also called content delivery, online distribution, or electronic software distribution (ESD), among others) describes the delivery of media content such as audio, video,software and video games, without the use of physical media usually over online delivery mediums, such as the Internet ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Digital distribution bypasses conventional physical distribution methods, such as paper or DVDs. The term online distribution is typically applied to freestanding products; downloadable add-ons for other products are more commonly known as downloadable content. Electronic Sofware Disrtibution is therefore a service and the following questions need to be answered for determining taxability: What ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is the place of provision of the service? Is the place of provision in taxable territory? If yes, tax will be payable. If not, tax will not be payable. Is the provider 'located' in the taxable territory? If yes, he will pay the tax. If not, is the service receiver located in taxable territory? If yes, he may be liable to pay tax on reverse charge basis. Reply By rajesh rathore: The Reply: Dear Si ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r, Thanks for reply, But still it is not clear that which tax should be charged to us (i.e. Service tax/Sale tax on ESD). So please give some notification details for same. Regards Rajesh Rathore Reply By Seetharaman K C: The Reply: As per Section 66B of the Finance Act , 1994. To be a taxable a service should be - ♦ provided or agreed to be provided by a person to another &diams ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ; in the taxable territory ♦ and should not be specified in the negative list. In your case the service is not specified in the negative list and so what is important is to find out whether it is provided in the Taxable Territory Reply By MITSUI PRIME: The Reply: Dear Sir, Thank for reply I am taking about "Electronic Software distribution" means software downloading from Seller websi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te and seller will provide licence this type of contain specied metiona in any notificaiton or any rule or any allied section. Regards Arjun Sachdeva Reply By Seetharaman K C: The Reply: After the introduction of the Negative List concept all services are taxable unless they figure in the Negative List or Exemption List. Electronic Software Distribution is therefore a taxable service as it do ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es not figure in any of these lists. To my knowledge there is no specific notification on this issue Reply By JAMES PG: The Reply: It has been clarified in the Education Guide on Service Tax that if the software is put on media like CD's or embedded on the computer before sale, the same would be treated as goods and is subject to Sales Tax and not Service Tax. If the software is delivered online ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or is downloaded on the internet, the same woould not be treated as goods as software as the judgement of SC in TCS case is applicable only in the case of pre packaged software X X X X Extracts X X X X X X X X Extracts X X X X
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