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TMI Blog2016 (9) TMI 324X X X X Extracts X X X X X X X X Extracts X X X X ..... anches’ turnover is not export being branches are distinct person, the same principle will apply for the purpose of total turnover of the assessee. Department cannot take contrary stand that in one hand the branches turnover is not export turnover and in other hand it is addable in total turnover of the assesse - branches turnover neither included in export turnover nor in the total turnover of the assesse – appeal disposed off – denial of refund justified – decided against assessee. - ST/85638 & 85880/15 - A/89246-89247/16/SMB, S/89248/16/SMB - Dated:- 18-8-2016 - Mr. Ramesh Nair, Member (Judicial) Shri. M.P.S.Joshi, Advocate for the assessee Shri. V.K. Shastri, Asstt. Commissioner( A.R.) for the Revenue ORDER The fact of the case is that the assessee is engaged in export of IT services. Apart from providing services from India to abroad, the branch offices of the assessee located in South Africa and UK are also providing services to overseas clients. For these services invoices are raised by the branch offices of South Africa and UK and payment thereagainst were also received by the branches. A part amount was repatriated to India out of the proceed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as Location of Service Provider . He further submits that the service even provided from branch office falls under the definition of export of service as provided under Rule 6A of the Service Tax Rules, 1994. He submits that the Ld. Commissioner erred in arriving at value of services rendered by the branches at ₹ 5,81,79,722/- as the same was not supported by any material consequently it was not required to be excluded from net export turnover. 3. On the other hand, Shri. V.K. Shastri, Ld. Asstt. Commissioner( A.R.) appearing on behalf of the Revenue, in respect of assessee s appeal, reiterates the findings of the impugned order. As regard the departmental appeal he submits that the Ld. Commissioner has wrongly reduced the value of services provided by the overseas branches of the assessee from total turnover for the reason that as regard total turnover a company s overall turnover of all the locations is considered, turnover of the assessee s branches is also part and parcel of Total turnover of the assessee. The Ld. Commissioner by deducting the branch turnover from the total turnover allowed the refund of ₹ 7,68,757/- which is n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of State Legislature, Members of Panchayats, Members of Municipalities and Members of other local authorities who receive any consideration in performing the functions of that office as such member; or (B) the duties performed by any person who holds any post in pursuance of the provisions of the Constitution in that capacity; or (C) the duties performed by any person as a Chairperson or a Member or a Director in a body established by the Central Government or State Governments or local authority and who is not deemed as an employee before the commencement of this section. Explanation 2.- For the purposes of this clause, the expression transaction in money or actionable claim shall not include- (i) any activity relating to use of money or its conversion by cash or by any other mode, from one form, currency or denomination, to another form, currency or denomination for which a separate consideration is charged; (ii) any activity carried out, for a consideration, in relation to, or for facilitation of, a transaction in money or actionable claim, including the activity carried out- (a) by a lottery distributor or selling agent on behalf of the State Gov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... een obtained; (b) where the service provider is not covered under sub-clause (a): (i) the location of his business establishment; (ii) where the services are provided from a place other than the business establishment, that is to say, a fixed establishment elsewhere, the location of such establishment; or (iii )where services are provided from more than one establishment, whether business or fixed, the establishment most directly concerned with the provision of the service; and (iv) in the absence of such places, the usual place of residence of the service provider 3. Place of provision generally - The place of provision of a service shall be the location of the recipient of service: Provided that in case the location of the service receiver is not available in the ordinary course of business, the place of provision shall be the location of the provider of service. Rule 2 [6A Export of Services. - (1) The provision of any service provided or agreed to be provided shall be treated as export of service when, - (a) The provider of service is located in the taxable territory, (b) The recipient of the service is located outside India, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... am of the view that the services provided by the branches of the assessee do not fall within the four corners of the term Export of Service . 6. As regard the Revenue s appeal on the ground that value of service provided by the overseas branches should be added in total turnover, I find that as per the above discussion that services provided by the overseas branches being other than export services is based on the interpretation of the provisions referred above that the overseas branches of the assessee are distinct person. Moreover, the service value was also received by the overseas branches only. In such case department cannot take contrary stand that in one hand the branches turnover is not export turnover and in other hand it is addable in total turnover of the assessee. Once it is held that branches turnover is not export being branches are distinct person, the same principle will apply for the purpose of total turnover of the assessee. Accordingly the branches turnover will neither be included in export turnover nor in the total turnover of the assessee. Hence the Revenue s appeal will not survive. As per my above discussion, the imp ..... X X X X Extracts X X X X X X X X Extracts X X X X
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