9911796707
TMI Blog2018 (11) TMI 461X X X X Extracts X X X X X X X X Extracts X X X X ..... the amount paid to the affiliates for the benefit of the appellant’s own employees, is not to be treated as consideration towards providing manpower recruitment and supply agency service - Admittedly, appellant is not Manpower Recruitment or supply Agency, therefore, the appellant is not liable to pay service tax under reverse charge mechanism. Technical testing service - testing for sample dispatched of its product and raw materials to laboratories located outside India for analysis and testing making report available to the appellant - demand pertains to the period 1.1.2005 to 17.4.2006 - Held that:- Hon’ble Bombay High Court in the case of Indian National Ship-owners Association vs. Union of India [2008 (12) TMI 41 - BOMBAY HIGH COURT] which has been affirmed by the Hon’ble Supreme Court reported in 2010 (17) STR J57 (SC) has observed that prior to 18.4.2006, no service tax is payable by the recipient located in India on the service received from abroad under reverse charge mechanism - As the period pertains prior to 18.4.2006, therefore the demand is not sustainable. Commercial Training or Coaching service - appellant received books from M/s. Competitive Dynamics and SGV ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d therefore be covered by the circular. Therefore, any service rendered outside India is not taxable in India - demand not sustainable. Mnagement consultancy service - period 1.1.2005 to 10.5.2007 - Held that:- The appellant has incurred expenses to students of Switzerland who undertake studies on how to improve the productivity of milk and come for training and provide advice to mil farmers. The said activity of providing assistance or advice in respect of technical aspects of production would not be covered under the definition of „management consultant. Similarly, these students are not managing the appellant’s organizaiton as they have to do nothing with management of organization. In that circumstance, no service tax is payable under management consultancy service - demand not sustainable. Consultancy engineer services - period 1.1.2005 to 31.12.2008 - Held that:- The expenses incurred towards licence renewal of job evaluation system to reward technologies Pty Limited and for spares paid to Gambo B.V. which cannot be categorized under consultancy engineer services, no service tax is payable by the appellant - demand set aside. Misc. expenses for the period 1.1.2005 to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o share expenses towards establishing and maintaining a SAP software system providing standardized information infrastructure. 4 (1) (i). The contention of Ld. Counsel for the appellant is that the said service covered by the decision of this Tribunal in the case of United Telcom Limited -2009 (14) STR 212 (Tri.-Bang.) which has been affirmed by Hon ble Karnataka High Court reported in 2014 (33) STR J193 (Kar). The same view has been followed by this Tribunal in the case of State Bank of India- 2015 (37) STR 340 (Tri.-Mum.) and BASF India Ltd.-2018-TIOL-1744-CESTAT-Mum. It is his contention that online information and data base access and retrieval means providing data or information, retrieval or otherwise to any person in electronic form through a computer network. No data can be retrieved or access by any person. In that circumstance, the service received by the appellant does not qualify as service in terms of Section 65 (75) of the Finance Act, 1994. Therefore, the appellant is not liable to pay service tax on the said service. 4 (1) (ii). On the other hand, Ld.AR submits that as per agreement, the appellant together with other Nestle affiliates obtained right to use S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (supra), wherein the Hon ble High Court has observed as under:- Appellate Tribunal in its impugned order had held that appellant provided Wide Area Network (WAN) to Andhra Pradesh Government connecting all Government offices in State capital and District Centres for which equipments like network interfaces provided and ensured effective working of ports. Flow of information from different Centres to Headquarter and vice versa cannot be equated to online information and data retrieval. It was further held that private network service like WAN covered under Telecommunication Service introduced from 1-7-2007 and not covered under Online Information and Database Access or Retrieval service. Demand and penalty set aside. Therefore, we hold that the appellant is not liable to pay service tax under reverse charge mechanism. (2) The demand of ₹ 13,81,919/- has been confirmed under the category of Manpower Recruitment or supply Agency service on the premise that the appellant has incurred expenses in foreign exchange largely in relation to bonus, medical expenses and school fees, for employees of other Nestle Affiliates with whom the appellant has entered into emp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tainable and the same is set aside. (4) With regard to the demand of ₹ 76,820/- has been confirmed under Commercial Training or Coaching service. 4(4) (i). We find that the appellant received books from M/s. Competitive Dynamics and SGV Development, which is sought to be taxed in the present proceedings. Further amounts were remitted abroad towards training of employees outside India. Mere supply of reading material cannot be equated to postal coaching. Further training services for employees were rendered outside India and not taxable as import of service. Services, if any, having been performed outside India, cannot be taxed in India in view of the decision of this Tribunal in the case of Cerebral Learning Solutions Pvt.Ltd.-2013 (32) STR 379 (Tri.-Del.)wherein this Tribunal has observed as under:- 4. The genesis of this avoidable lis could be traced to Circular No. 59/8/2003-S.T., dated 20-6-2003. The relevant legislative provision and the exemption granted vide Notification No. 12/2003-S.T., dated 20-6-2003 admit of no ambiguity. It is the admitted factual scenario that the assessee had provided the taxable service of Commercial Training and Coaching qua ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... two places and therefore, in the absence of provision of data or information, internet charges cannot be liable to tax under the category of Online Information and Data base Access Retrieval service as held by this Tribunal in the case of State Bank of India (supra) wherein this Tribunal has observed as under:- 9. If we examine the case vis- -vis the coverage of Section 65(105)(zh), here again the department is on a weak footing. The very description under the contract between SBI and Equant shows that Equant IP VPN is a managed network service that provides secure IP internet working which enables connectivity. The IP VPN network does not allow customers routers in different VPNs to connect with one another. Therefore, it is clear that the said VPN does not provide connectivity between SBI domestic office and the SBI foreign office. Further, on going through the definition in Section 65(75) it is seen that the same describes the service to be providing data or information retrieval or otherwise to a customer. In the present case, it has nowhere been disputed by revenue that the data centre is located abroad to which the foreign offices have access for data and its r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is not taxable under the reverse charge mechanism in view of the decision of the Hon ble Bombay High Court in the case of Indian National Ship-owners Association (supra), the demand confirmed under the category of club or association service is not sustainable against the appellant and the same is set aside. (7) The demand of ₹ 8,97,936/- has been confirmed under the category of advertising and advertising agency for the period 1.1.2005 to 17.4.2006. 4 (7) (i) We find that the demand has been confirmed for the period 1.1.2005 to 17.4.2006 under the reverse charge mechanism prior to 18.4.2006, therefore, the said demand is not sustainable against the appellant in view of the decision of the Hon ble Bombay High Court in the case of Indian National Ship-owners Association (supra). (8) The demand of ₹ 2,16,768/-- has been confirmed under software maintenance for the period 1.1.2005 to 31.12.2007. 4 (8) (i). We find that the appellant has procured software packages for its accounts department, human resource, enterprise resource planning, maintaining consumer complaint and licence of Microsoft Software and incurred expenses for use and their maintenance ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... neer services for the period 1.1.2005 to 31.12.2008. 4 (10) (i). The visiting fees paid by the appellant for providing services in India and outside India. 4 (10) (ii). We find that the expenses incurred towards licence renewal of job evaluation system to reward technologies Pty Limited and for spares paid to Gambo B.V. which cannot be categorized under consultancy engineer services, no service tax is payable by the appellant. (11) The demand has been confirmed on account of misc. expenses for the period 1.1.2005 to 31.12.2008. 4 (11) (i). We find that the appellant has incurred miscellaneous expenses in convertible foreign exchange which includes legal charges, courier charges, import of product samples, book, charges for damages goods exported, entertainment expenses abroad, membership fees, etc. 4(11) (ii). We find that the show cause notice has not indicated the specific category of taxable services under which the said amount is taxable. In that circumstance, no service tax is payable by the appellant. Moreover, the services provided outside India and for the services rendered outside India no service tax is payable in India. (12) The demand has bee ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
