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TMI Blog2016 (8) TMI 989X X X X Extracts X X X X X X X X Extracts X X X X ..... e Neutrality is a good ground, more so when the tax liability is being discharged under reverse charge mechanism. This very plea of revenue neutrality in an identical issue was raised in British Airways case and decided in favor of appellant. – appeal disposed off – decided in favor of appellant. - ST/87494 to 87498/13 - A/88840-88844/16/STB - Dated:- 29-7-2016 - Mr. M.V. Ravindran, Member (Judicial) and Mr. C.J. Mathew, Member (Technical) Shri Rafiq Dada - Sr. Advocate, Shri Rohan Shah, Shri J.H. Motwani, Ms. Divya Jaswant, Ms. Sanchita Rungta, Advocates for appellant Shri Roopam Kapoor, Commr (AR) for respondent ORDER These appeals are directed against order-in-original No. 60-64/STC-1/SKS/12-13 dated 14.03.2013. 2. Since all the three appeals raise a common issue and in respect of the very same assessee, they are being disposed of by a common order. 3. This matter was heard at length for three days i.e. 16th March, 28th March and 5th April of 2016. The issue in brief is that appellant herein is engaged in running an airlines having operations all over India as well as outside India. Based on intelligence that the appellant is evading servic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d the tax from the appellant as recipient of the services from the Company based abroad. Appellant contested the show-cause notice on merits as well as on limitation ( in one show-cause notice extended period of limitation is invoked). It was the case of the appellant before lower authorities that provisions of Section 66A will not apply in this case and the services cannot be categorized as falling under online information and database access or retrieval service. The adjudicating authority after following due process of law, did not agree with the contentions raised by the appellant and confirmed the demands raised along with interest and imposed penalties. The adjudicating authority however, dropped the demands raised for the period 01.04.2003 to 17.04.2006 on the ground that the provisions of Section 66A for demanding service tax under reverse charge mechanism was introduced in statute from 18.04.2006 only. 3. Shri Rafiq Dada, Sr. Advocate with Shri Rohan Shah, Shri J.H. Motwani, Advocate, Ms. Divya Jaswant, Advocate and Ms. Sanjita Rungta, Advocate appeared on behalf of the appellant and Shri Roopam Kapoor, Commissioner (A.R.) appeared for the Revenue. 4. Lear ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reted so widely, it would cover activities such as maintenance of servers, upgrading of interface software, provision of manpower for operation of the interface etc., when in fact these activities were only brought to tax under other taxable entries at a subsequent point of time without any simultaneous amendment to the present entry. It is his further submission that in any event, any provision of data, if at all, is incidental to the main activity of ticket booking and cannot form the basis of classification. It is his further submission that the activities of CRS Companies in providing a technology platform in respect of the data of the airlines and enabling the Travel Agents to make reservations and purchase tickets effectively facilities and culminates in an overall e-commerce transaction, which is not liable to service tax. For the proposition that e-commerce transaction are not liable to service tax, he relies upon the judgement of the Apex Court in the case of All India Federation of Tax Practioners vs. UOI - 2007 (7) STR 625 (SC) and Circular No. MOF. F.No. B-11/1/2001-TRU dated 9th July 2001. It is his further submission that the person liable to pay tax are the CRS ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rendered by the service provider which in this case, the appellant is not service recipient as no services are provided to by the appellant to the CRS Companies; Travel Agent has an independent contract with the CRS Company to access data while the impugned order holds that the benefit of services goes to the appellant which is very week and there is no specification of the service receiver and the person who receives the benefit cannot be said to be service recipient. He would submit in the absence of service provider, service recipient relationship between he appellant and the CRS Companies, service tax liability cannot be critical qua the appellant need reverse charge mechanism. He would further submit that there must be an access between the payment which is sought to be service tax and the taxable which is alleged to have been received. He would submit that in the facts of this case there is no payment for access and retrieval of the data of the Travel Agent and the Travel Agent is at liberty to as many accesses as he desires and also make retrieval for which there is no charge. It is his submission that the charge is payment only when the ticket is booked and such payment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... definition of exempted services needs to be gone into but there was no challenge to legality of the framed rules regarding taxation and the service tax which means the services on which service tax is leviable under Section 66 of the Finance Act, 1994; the adjudicating authority has correctly come to the conclusion that part of the services by the appellant is an exempted services. He would submit that the adjudicating authority was correct in holding against the appellant as the majority decision of this Tribunal in the case of British Airways - 2014-TIOL-979-CESTAT-DEL and in the case of Qatar Airways - 2014-TIOL-1767-CESTAT-Mum has held that the services provided by the CRS Companies are covered within the scope of on-line information and data base access or retrieval service . As regards the demand by invoking extended period he would submit that the extended period has been correctly invoked as the appellant has not filed any return or gave any information regarding the payment of an amount to CRS Companies. 6. In rejoinder, learned Sr. Advocate submits that the reliance placed by the learned Commissioner (A.R.) on the decision of British Airways (supra), Qatar Airways ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... base access or retrieval service. Much was argued by both sides after taking us through the relevant entries and also various case laws. We find from the argument put forth by the learned Sr. Counsel for the appellant that the said activities of CRS Companies would not fall under the category of online information database access or retrievable services seems to be incorrect on merits, as an identical issue is decided by three judgements of this Tribunal by majority order. 9.2 We find that in the case of British Airways - 2014-TIOL-979-CESTAT-Del which was decided on 23.05.2014, the issue was regarding the service tax liability on the same services provided by CRS Companies to British Airways. There was a difference of opinion between the Members who heard the matter initially. Learned Member (Technical) in his findings in Para 29 recorded as under:- 29. Coming first to the question of classification of the service, the activity of the CRS/GDS Companies is maintaining online information on real time basis about the flight schedules, fare, seat availability etc. of the flights being operated by BA,U.K. all over the world, for which CRS/GDS Companies have linkage wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... relatable to the fact as to whether British Airways, India, has received the service provided by the CRS/GDS companies located abroad or whether British Airways, UK have to be treated as recipient of the said services. 9.3 It can be seen from the above reproduced findings recorded in the case of British Airways categorically holds that the activities of CRS Companies would fall under the category of online information and database access or retrieval service . Nothing was brought to our notice which would require revisit of the said views as held by the Tribunal. We note that identical views were expressed by the Bench in the case of Austrian Airways - 2014-TIOL-1574-CESTAT-Del and Thai Airways International Public Company Ltd.. 2013-TIOL-1117-CESTAT-Del. 9.4 We find that all these three judgements as cited hereinabove are difference of opinion decided by a 3rd Member. All these three judgements categorically record and hold that the activities rendered by CRS Companies are classifiable under online information and database access or retrieval service . On the base of such authoritative decision, we do not find any compelling reason to revisit the same or refer the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... service. 10.3 Secondly, it is nobody s case that the service tax liability on online information and database access or retrieval service is paid by the appellant in respect of the tickets issued which are directly linkable to the output services provided by the appellant. 10.4 In our considered view the appellant could have availed CENVAT credit of the service tax paid on reverse charge mechanism as they are liable to pay tax on output service hence Revenue neutral situation arises wherein appellant pays the tax and takes the credit. We note that the issue as to confirmation of service tax liability arsse on the payment made to CRS Company, as decided by majority decisions in three cases namely British Airways, Thai International Public Co. Ltd. and Austrian Airways wherein the question of revenue neutrality arose, which was answered in favour of assesses therein. It is trait law that question of Revenue Neutrality is a good ground, more so when the tax liability is being discharged under reverse charge mechanism. This very plea of revenue neutrality in an identical issue was raised in British Airways case and decided also. It is settled law when an issue is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by them. The present demand confirmed against them, was admissible to them as Cenvat credit, which could have been further utilised for discharge of their service tax liabilities. I do not agree with the reasoning adopted by ld. Judicial Member that inasmuch as the tax has not been paid by them, the credit would not be available. The said finding is contrary to the law laid down by various Courts, including the Hon'ble Supreme Court. Admittedly, the demands stand raised by invoking the longer period of limitation and during the relevant period, there was no service tax being paid by M/s British Airways India and as such the question of availability of credit of the same would become relevant only once the demands stand raised subsequently on a disputed issue. Had they been paying the service tax during the relevant period, they would have been availing the credit of the same and utilising the same for discharge of admitted service tax liability, leading to Revenue neutral situation. The question of availability of credit in a subsequently raised confirmed demand would arise only at the time of finalisation of the demand itself. Reference in this regard can be made to the Hon ..... X X X X Extracts X X X X X X X X Extracts X X X X
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