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TMI Blog2014 (12) TMI 25X X X X Extracts X X X X X X X X Extracts X X X X ..... tenance of equipment on behalf of their foreign clients to Indian buyers. They have provided the service on behalf of their foreign clients. We further find that during the warranty period, the repairs and maintenance service was to be provided by the foreign supplier and the appellant acted on behalf of the foreign supplier only. It is an admitted fact that the Indian buyer has not paid any amount towards the service provided by the appellant to the appellant during warranty period whereas the appellant who provided the service to Indian buyers has paid the service tax on maintenance service after the warranty period. - Appellant has provided the service of procuring purchase orders for their foreign clients and providing maintenance service to the Indian buyers during the warranty period on behalf of their foreign clients on the instructions of foreign clients are covered by the Rule 3(3) of Export of Taxable Service Rules, 2005. Therefore, the appellant are not required to pay service tax during the impugned period for their activity. Accordingly, they are entitled for refund claim - Decided in favour of assessee. - Appeal No.ST/74/08-Mum - Final Order No. A/1611/2014-WZB/C-I(C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... merce or industry and the recipient of such services is located outside India. As the service provided by the appellant is in relation to trading activity and maintenance and repairs and the recipient of the service is located outside India, therefore, they are squarely covered by the said Rule and they are not liable to pay service tax. He further submits that Notification 13/06-ST dated 19.04.2006 provides that the export of service is when such service is delivered outside India and used outside India and the payment thereof is received by the service provider in convertible foreign exchange. It is not in dispute that the appellant has received all the payment in convertible foreign exchange and they have delivered the service outside India, therefore they are entitled for refund of service tax wrongly paid by them. After warranty period, the appellants are providing maintenance service for which they are registered, as stated by the Ld. Counsel. 4. On the other hand, ld. AR opposed the contention of the counsel and submits that in this case the service has been provided in India, therefore as per Notification 13/06-ST dated 19.04.2006 the activity of the appellant does not q ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cation of the activity of Agents and sub-agents, their activity essentially is providing of service of delivery of money on behalf of WU and also undertaking promotion and marketing of the money transfer service provided by WU. Agents by delivering money on behalf of WU to the intended beneficiary of the sender of money abroad are discharging the obligation of delivering money to the intending beneficiaries on behalf of WU and in the cases where the money is delivered by sub-agents, the sub-agents are performing the same job. This activity, in my view, is covered by clause (vi) of Section 65(19) as it stood w.e.f . 10.09.2004- Provision of service on behalf of client and during period prior to 10.09.2004, this activity would be covered by the service rendered by a person as commission agent , who in terms of definition of this term is Notification No. 14/04-ST covered, among others, the person who acts on behalf of another person and causes sale or purchase of goods or provision or receipt of services for a consideration. Though w.e.f . 1.6.2005, services in relation to transfer of money including telegraphic transfer provided by a banking company or a financial institution ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of multi-locational service providers; there must be a uniform criteria for determining as to at which place the multi-locational service provider is to be treated as located for the purpose of taxation. Therefore, what constitutes the export of service cannot be left to the deductive capability of individual tax payers or individual tax collectors, as doing so will cause a total chaos. For this reason only, the Export of Service Rules, 2005 have been framed by the Central Government under Section 94(1)(f) of the Finance Act, 1994. A little analysis of these rules will show that the same follow the general principle that a taxable service provided by a person in India will be subject to tax only when it has been consumed in India and not when it has not be consumed in India, which is in accordance with the ruling of the Apex Court in case of All India Federation of Tax Practitioners Association (supra) . In my view it is absolutely correct to treat- (a) performance based services (e.g. services of repair maintenance of some machinery provided by an Indian company to its client in USA) as consumed at the place where the same have been performed; (b) Services ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ess Auxiliary Service covered by Section 65(105)(zzb) read with Section 65(19) irrespective of whether it is treated as provided to Agents or to WU. The plea of the sub-agents is that they have tripartite arrangement with Agents of WU and WU, that they also represent WU, that recipient of their services is WU, not the Agents and that, therefore, the services provided by them have to be treated as export of service. The contention of the Revenue on the other hand, is that the sub-agents have provided taxable service to Agents not to WU and therefore, in any case, the commission received by the sub-agents for the services provided by them to Agents is chargeable to Service tax. 8. We further find that a similar issue came up before the Hon'ble High Court of Bombay in SGS India P. Ltd. - 2014-TIOL-580-HC-MUM-ST wherein the facts are as follows. The appellant was engaged by foreign importers who imported certain goods from India exporters. The foreign parties wanted the appellant to inspect/test/analyse samples of the goods in India and provide certificates to enable them to ascertain the quality of the goods before importation. Accordingly, the appellant inspected/tested/analy ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed upon the circulars issued and prior thereto the view taken by it in the case of KSH International Pvt.Ltd Vs . Commissioner and B.A. Research India Ltd. The case of the present respondent was said to be covered by orders in these two cases. To our mind, once the Hon'ble Supreme Court has taken the view that service tax is a value added tax which in turn is destination based consumption tax in the sense that it taxes noncommerical activities and is not a charge on the business, but on the consumer, then, it is leviable only on services provided within the country. It is this finding and conclusion of the Hon'ble Supreme Court which has been applied by the Tribunal in the facts and circumstances of the present case. 25. The view taken by the Tribunal therefore, cannot be said to be perverse or vitiated by an error of law apparent on the face of the record. If the emphasis is on consumption of service then, the order passed by the Tribunal does not raise any substantial question of law. 26. We are of the view that any larger or wider controversy and based on the submissions of Shri Sridharan need not be decided in this case. Suffice it to hold that the view ta ..... X X X X Extracts X X X X X X X X Extracts X X X X
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