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TMI Blog2016 (10) TMI 309X X X X Extracts X X X X X X X X Extracts X X X X ..... essee with bottlers can be considered as agreement for payment of royalty by the bottlers to the appellant-assessee liable to service tax as held by the impugned order - Held that:- on careful perusal of the terms of both agreements, we find that there are substantial material differences and the tie up agreement cannot be considered for service tax liability under the category of royalty payment. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Handa, A.R for the respondent ORDER There are two appeals. One by the assessee and another by the Revenue against the same order dated 31.03.2011 of Commissioner of Central Excise, Ludhiana. Both the appeals are taken up together for disposal. 2. The impugned order found that there is no dispute regarding leviabilty of service tax on royalty received by the appellant-assessee, in respect of ro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by the impugned order. 5. On examination of both manufacturing/tie up based agreement and royalty based agreement, we find that there are material differences in the scope and application of these agreements. It is noticed that in the case of tie up based agreement, a typical tie-up based manufacturing agreement stipulates that the bottlers are the manufacturers under licence granted by the Sta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eement cannot be considered for service tax liability under the category of royalty payment. We find that though the lower authority noted the contents of both Board's circular dated 27.10.2008 to the effect that tie up based agreements are not covered the IPR services for service tax, he proceeded to record that in the present case manufacturing agreement are essentially same as royalty based ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... turing/tie-up agreement, there is no scope for service tax levy on the brand owner. 6. In B.D.A Ltd. (supra), the Tribunal's decision was taken by the Revenue in appeal before the Hon'ble Supreme Court. The Hon'ble Supreme Court vide order dated 30.11.2015 dismissed the appeal as devoid of any merits. Having taken note of facts of the present case, and the decisions of the Tribunal as ..... X X X X Extracts X X X X X X X X Extracts X X X X
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