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TMI Blog2008 (8) TMI 191X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Commissioner of Service Tax, Bangalore. 2. Shri Arvind Dattar, learned Sr. Advocate and Shri B.N. Gururaj, learned advocate appeared on behalf of the appellant. Mrs. Sudha Koka, learned SDR appeared for the revenue. 3. We heard both sides. 4. The appellants entered into a contract with the Government of Andhra Pradesh. In terms of the contract, the appellants are to build, own and operate a Wide Area Network (WAN) according to technical requirements to provide voice, video and data communication services to Andhra Pradesh Technology Services Ltd. (APTS) user organization which includes Government of Andhra Pradesh, State Public Sector Undertakings, local bodies in Andhra Pradesh and other autonomous and semi autonomous organizations set up by the Government and private organizations for interactions with the Government. The point at issue is whether the appellant is liable to pay Service Tax under the category of 'Online Information and Database Access and/or Retrieval Service'. On the basis of the documents, revenue came to the conclusion that the appellant would be liable for Service Tax under the above category. Hence, proceedings were initiated ag ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed advocates is that the data and information on the APSWAN belongs to Government of Andhra Pradesh and is not owned or controlled by the noticee. Therefore, the appellant cannot be paid to provide data or information over computer network. It was also stated that the appellant does not control the traffic over APSWAN and that responsibility lies with APTS. It was stated that computer network is analogous to highway which reaches various destinations and carries traffic. But, highway authority does not either set up destination or permit or control the traffic. Similarly the noticee does not put up for control data or voice traffic over APSWAN. It was also stated that in the definition of 'taxable service' in Section 65 (105) ZH in relation to cannot be widely interpreted. In the context of other services, this phrase has been read narrowly and they rely on the following decisions. a. CCE Vs. Team UPD Ltd. - 2005 (179) ELT 469 (T). b. CCE Vs. Azad Publications - 2004 (167) ELT 59 (T.-Del.) c. Star Neon Sign Vs. CCE - 2002 (49) RLT 541 (CEGAT-Del.) = 2002 (141) ELT 770 (T.-Del.) d. CCE Vs. The Incoda - 2004 (64) RLT 420 (CESTAT-Kol.) = 2004 (174 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... upport such as establishing WAN, VAN and LAN. A plain reading of the name of service Online Information and Database Access or Retrieval service, particularly the last three words in bold clearly indicate that it is a service provided to enable the user to gain access/ retrieve the online information or database. It is clearly understandable that in order to gain access to online information or the data, two things are essential. One is network or the hardware which is the basic essentiality for transmission of the data and the other one is the software to carry out the operation of the access of database with the aid of the network. Both have to go hand in hand and if one of them fails the access is not possible. Hence, without having to go into the meaning of any of the complex terminologies it plainly follows that providing access to information or data through a medium or network is a service and the services rendered by the appellant would squarely fall within the ambit of Online Information and Database Access or Retrieval Service . 6.2 Reference was made to the Board's Circular dated 9.7.2001 [reported in 2001 (45) RLT M55] wherein the Board has stated that inter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the present case, the Andhra Pradesh Government uses the Wide Area Network because the different districts and state capital are situated far from each other. They have to be connected for communication. The ultimate aim is proper governance. For this purpose, the Andhra Pradesh State Government wanted to establish Wide Area Network. The appellants are involved with that Wide Area Network. Therefore, APSWAN is a network providing connectivity between all government offices in state capital and district centers. 7.1 On going through the contract, we can cull-out the responsibility of the appellant. It is seen that the entire network is not provided by the appellant. What the appellant is providing to the Andhra Pradesh Government is given in Annexure-1 of the Contract. They are as follows: 1. Multi-services switch 2. Routers 3. Firewall 4. Network Management 5. Accounting Service All the equipments are placed in the physical locations called DNCs (District Networking Centres) in the districts and SNC (State Networking Centre) in Hyderabad. Annexure-1 to the Contract further gives the functional requirements and capacity requirements of the various equipments. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion between the districts and the state headquarters. The information will be flowing from different centers to the headquarters and vice versa. This cannot be equated with online information and data retrieval. In any case, the appellant is not responsible for the entire network because we find that the communication lines have been leased out from the BSNL by the Andhra Pradesh Government. When they are not functioning, the appellants are not responsible and they do not lose their service charges. They are responsible only for the proper functioning of the equipment supplied by them. Moreover, the data is generated only by the Andhra Pradesh Government and the same is being used by the different wings of the Government, therefore, the appellant has also not provided any data. The responsibility of the appellant is to see that the network (WAN) functions. This cannot be equated with Online database access/retrieval services . Hence, we cannot understand how the Commissioner has come to the conclusion that the appellant provides this service. The Commissioner's reference to Board's Circular with regard to internet service provided is not at all correct. In our view, the s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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