2014 (9) TMI 874

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..... software design and development service to their clients in India and abroad. They have a branch office in Seoul, Korea (TTL Korea). They entered into a Tripartite agreement i.e. between TTL and TTL Korea on the one hand and M/s. Tata Daewoo Commercial Vehicle Co. Ltd. (TDCVL in short) for implementation and maintenance of SAP Software. These services were provided at the premises of TDCVL in Korea. The services consisted of two components, namely, onsite services to be provided by TTL Korea and offshore services to be provided by TTL. For payment of services rendered, the TDCVL agreed to pay a lump sum consulting fee of US$ 10,02,000/- The said payment was to be made in 12 monthly installments and TTL Korea was authorized to raise 12 mont .....

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..... ubmission that the services consisted of two components - onsite services and offshore services. The first being provided by TTL Korea to TDCVL and the second being provided by TTL to TDCVL. The service recipient is TDCVL and for the services rendered, payment has been made in convertible foreign exchange. They have raised bill to TTL Korea towards the offshore services rendered by them and TTL Korea has to make payment for the same. To invoke Section 66A, service should have been received in India and service recipient in India has to pay for the services received. In the present case, there is no receipt of service in India and the situation is just the opposite. They have rendered the service to a foreign entity situated in Korea through .....

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..... ility has been discharged by TTL Korea at the time of supply of services to TDCVL. If that be so, the question of subjecting the same transaction to Service Tax in India at the hands of TTL would not arise at all. 5.2 Secondly, the C.B.E. & C. in the case of M/s. Tech Mahindra relating to IT Software services had clarified that onsite services rendered abroad would not be treated as service provided from India. In other words, the question of subjecting such transactions under Service Tax in India would not arise at all. 5.3 As regards the offshore services rendered by M/s. TTL to TDCVL, the same amounts to export of service in terms of Rule 3(2)(a) of the Export of Service Rules, 2005. Information Technology Software service is .....

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