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TMI Blog2017 (4) TMI 37X X X X Extracts X X X X X X X X Extracts X X X X ..... in any manner in one or more disciplines of engineering including the discipline of computer hardware engineering [Section 65 (105) (g)]. We also refer to the trade notice of the Department dated 04.07.1997 which explained the scope of tax entry. We note that the appellants are not involved in any service of intellectual property and do not come in possession of any such IPR. The terms of the agreement do not provide for payment of any consideration for transfer of any such IP Rights. The appellants are engaged in providing consultancy with reference to licensed unit in India for and on behalf of foreign entity. As such, based on the location of the recipient of service, the service is to be considered as exported. The benefit of service ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s of Rule 5 of the Export of Services Rules, 2005. The present dispute is relating to their eligibility for such claims. The original authority rejected the appellants claims for rebate mainly on the ground that the services provided by the appellant appear to fall under the category of intellectual property service and not under engineering consultancy service as claimed by the appellant. Further, it was held that the services were rendered in India and cannot be categorized as export. On appeal, vide the impugned order, the ld. Commissioner (Appeals) held that classification of service is vital and in the present case the claims field by the appellant suffers because of it could not be conclusively determined as category (iii) service ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with the documentary evidence by the appellant. He relied on various decided cases to support his claim regarding classification of service as well as export of service. 3. The ld. A.R. supported the findings in the impugned order. He submitted that the conditions mentioned in Notification No.12/2005 ST are to be strictly complied with. Further, the original authority held that the appellants are engaged in taxable activity in India and this is in connection with setting up of licensed units of foreign supplier, in India. Hence, there is no export of service. 4. We have heard both the sides and perused the appeal records. 5. The scope of work carried out by the appellant as recorded in the impugned order is as below:- The c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... OGY. (f) Procurement and inspection services relating to LICENSED UNITS. (g) Consulting services relating to process plants and LICENSED UNITS. (h) Technical assistance services for erection, pre-commissioning, commissioning and test runs of Licensed Units and other process plants. (i) Technical services and supervision services for loading of HTAS catalysts in Licensed Units and other process plants. 6. The plain reading of the above terms of agreement will clearly show that the services rendered by the appellant will fall under the category of taxable services provided or to be provided to any person by a consulting engineer in relation to advise, consultancy or technical assistance in any manner in one or mor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for the same who has to be treated as recipient of service and not the person affected by the performance of the service. Thus, when the person on whose instructions the services, in question, has been provided and is located abroad, the destination of services, in question, has to be treated abroad. The destination has to be decided on the basis of place of consumption, not the place of performance of service in case of Business Auxiliary Service. In Microsoft Corporation (I) Pvt. Ltd. v. CST, New Delhi reported in 2014 (36) S.T.R. 766 (Tri. - Del.), the Tribunal held that the Business Auxiliary Services of promotion of market in India for foreign company amount to export of services. The Export of Services Rules, 2005 is considered as des ..... X X X X Extracts X X X X X X X X Extracts X X X X
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