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TMI Blog2016 (4) TMI 152X X X X Extracts X X X X X X X X Extracts X X X X ..... re to further disseminate the programme to others, such dissemination would be liable for tax as a separate and distinct service. Consequently, the usage of the programme after delivery to the overseas entity is irrelevant in deciding upon the tax liability as 'programme producer'. By following the settled law, the contention of Revenue that the distinction should remain blurred is rejected. Therefore, the services rendered by the respondent is delivered or provided from India to the overseas entity. Receipt in Indian currency is Receipt of consideration in convertible foreign currency or not - contract designates the consideration in Indian rupees - Held that:- HSBC, their bankers, indicating that inward remittance from the overseas entity was in convertible foreign currency. - Consequently, there is no justification for entertaining any doubt that inward remittances were in convertible foreign currency. Therefore, both the conditions for export in Rule 3(2) of Export of service Rules,2005 have been complied with. - Decided against the revenue - Appeal No. ST/651/2010, Cross Objection No. ST/CO-13/2011 - Final Order Nos. A/86272-86273/2016-WZB/STB - Dated:- 9-9-2015 - M. V. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ules, 2005 by failure to comply with conditions stipulated in the said Rules. 4. Rule 3(2) of the said Rules underwent a change with effect with 1 st March 2007 by substituting '(2) The provision of any taxable service specified in sub rule (1) shall be treated as export of service when the following conditions are satisfied, namely- (a) such service is delivered outside India and used outside India; and (b) payment for such service provided outside India is received by the service provider in convertible foreign exchange.' With '(2) The provision of any taxable service specified in sub rule (1) shall be treated as export of service when the following conditions are satisfied, namely- (a) such service is provided from India and used outside India; and (b) payment for such service provided outside India is received by the service provider in convertible foreign exchange.' 5. According to Revenue, the usage condition and currency condition, both common to the pre-amendment and post-amendment provisions, had not been satisfied in the transaction between M/s Balaji Telefilms Ltd. and M/s SGL Entertainment Ltd because the prog ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is predicated solely upon fulfillment of the conditions in Rule 3(2) of the said Rules. Attention was drawn to the enunciation in 'Principles of Statutory Interpretation' [GP Singh, Thirteenth Edition p831] 'But equitable considerations are not relevant in construing a taxing statute and, similarly logic or reason cannot be much avail in interpreting a taxing statute. It is well settled that in the field of taxation, hardship or equity has no role to play in determining eligibility to tax and it is for the legislature to determine the same.' 9. It would appear that the learned Authorized Representative canvasses the view that every seeming export cannot be deemed to be one unless the words of the statute expressly accords it that status. Having noted that, it would also appear that the learned Authorized Representative may, unintentionally, no doubt, have described the review proceedings which does not appear, prima facie, to find sustenance; except for the reference to the use to which the programme is put by the overseas entity, the review proceeding mirrors the show cause notice which had been considered at length and rejected in the impugned order. No ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gramme producer in relation a programme. There can be no doubt that, if the programme producer or any other person were to further disseminate the programme to others, such dissemination would be liable for tax as a separate and distinct service. Consequently, the usage of the programme after delivery to the overseas entity is irrelevant in deciding upon the tax liability as 'programme producer'. In the decisions cited supra, Revenue had sought to blur the distinction between investment advice and investment itself- a contention that did not find favour with the Tribunal. In the present appeal. Revenue seeks to blur the distinction between the programme delivered abroad by the appellant and the subsequent broadcasting of that programme. We respectfully follow the settled law and reject the contention of Revenue that the distinction should remain blurred. Therefore, the services rendered by the respondent is delivered or provided from India to the overseas entity and thus conforms to the first part of the outflow condition. 12. The same provisions in the Rules have been cited by both sides to this dispute to bolster their respective contentions. The changes effected in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... convertible foreign currency. The contract, undoubtedly, designates the consideration in Indian rupees. It is claimed by the respondent that this is normally resorted to so that the service provider is not put to loss on account of currency fluctuations and that, by such designation, the producer in India is assured of receiving the contracted amount; undeniably, a necessary factor in minimizing the risk of budgetary overrun. This justification is, unarguably, acceptable as logical. 15. The respondent did produce a certificate from Hongkong and Shanghai Banking Corporation Ltd. their bankers, indicating that inward remittance from the overseas entity was in convertible foreign currency. The original authority rendered its findings after acknowledging this certificate. In the light of this, it is surprising that Revenue has chosen to argue that the condition of inward remittance in Export of Service Rules, 2005 had not been fulfilled. 16. Admittedly, the Indian Rupee is not a freely convertible currency and benefit of export privileges were sought to be denied on the ground that contract was designated in Indian rupees. By that very argument, Indian rupee could not have been r ..... X X X X Extracts X X X X X X X X Extracts X X X X
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