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TMI Blog2025 (2) TMI 953X X X X Extracts X X X X X X X X Extracts X X X X ..... ded in favour of the appellant by the Larger Bench of the Tribunal in the case of M/S. ARCELOR MITTAL STAINLESS (I) P. LTD (NOW KNOWN AS M/S. ARCELOR MITTAL DISTRIBUTION SOLUTIONS INDIA PRIVATE LIMITED) VERSUS COMMISSIONER SERVICE TAX MUMBAI-II [2023 (8) TMI 107 - CESTAT MUMBAI-LB] wherein the Tribunal held 'It is, therefore, clear that the recipient of service is the person at whose desire the activity is done in exchange for a consideration, i.e., the person who is obliged to make payment for the service. The recipient of service would, therefore, be a person at whose instance and expense the service is provided, whether or not he is the beneficiary of the service.'
From the above, in the context of the present case, it is noted that the recipient of the service is JCB, UK who is also the person at whose desire the activity is done in exchange of monetary consideration.
Conclusion - The services rendered by the appellant were exports, thus not subject to service tax.
The impugned order is set aside - appeal allowed. X X X X Extracts X X X X X X X X Extracts X X X X ..... present appeal. 3. Learned counsel for the appellant submitted that the services rendered by the appellant to JCB UK qualify as 'export of service' under Rule 6A of the ST Rules, and as the place of provision of such services is outside the taxable territory, no service tax is payable thereon under Section 66B of the Act.Hence, for attracting the charge of service tax under Section 66B, it was imperative that the service must be provided or agreed to be provided in the taxable territory. He further submitted that the entire dispute in the present case is whether the services provided by the appellant qualify as export and for this, it is relevant to identify the place of provision of service, and thereafter, determine whether the conditions for export stipulated under Rule 6A of the ST Rules have been satisfied. The ld. Counsel submitted that in the present case, the show cause notice and the orders have itself ruled out the applicability of Rule 4 to 12 of the POPS Rules and have demanded service tax by determining the place of provision of subject services under Rule 3 of the POPS Rules. He submitted that in terms of Rule 3, the place of provision of a service shall be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... i-ll [2023 (8) TMI 107-CESTAT MUMBAI- LB]. The ld. Counsel also reliance placed on the following cases where it has been held that services provided by the assessee would qualify as export even if such services rendered in India:- * Orbit Research Associates Pvt. Ltd. Vs. Commissioner of Service Tax (Appeal-I), New Delhi [2023 (8) TMI 246-CESTAT New Delhi] * Involute Engineering Pvt. Ltd. Vs. Commissioner of Central Excise and Service Tax [2020 (12) TMI 533-CESTAT NEW DELHI] * Sara Sae P. Ltd. Vs. Commissioner, Customs, Central Excise & Service Tax Commissionerate, Meerut -1 [2020 (12) TMI 701-CESTAT NEW DELHI] * Commissioner of Service Tax, Noida Vs. Samsung India Electronics Pvt. Ltd. [2021 (2) TMI 399-CESTAT Allahabad] * GAP International Sourcing (India) Pvt. Ltd. Vs. CST [2014-TIOL-465-CESTAT-DEL] * Commissioner of Service Tax, Mumbai-vi vs. A.T.E. Enterprises Private Limited [2018 (8) GSTL 123 (Bombay)] 3.3 Hence, Ld. Counsel submitted that the services rendered by the Appellant have been received by the service recipient located outside India. He contended that the said service qualified as an export in terms of Rule 6A of the Service Tax Rules, 1994. The said ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rmissible period of 5 years and thus, deserves to be set aside on this ground alone. The ld. counsel submitted that in order to invoke the extended period of limitation, there must be non-payment or short payment of tax or erroneous refund by reason of fraud or collusion, etc. This necessarily means that the proper officer must establish the presence of an act, which would tantamount to fraud or collusion or wilful misstatement or suppression, and by reason of such act, the period of limitation would be extended. In the present case, the entire SCN while making the proposals against the appellant, the show cause notice nowhere refers to the presence of any mala fide on the part of the appellant. In fact, the show cause notice at para 33, page 88 merely states demand is recoverable by invoking extended period. There is no basis nor any element as envisaged under proviso to Section 73 (1) of the Act pointed out in the SCN on the basis of which extended period of limitation has been invoked. In support of his submissions, the ld. Counsel relied upon the following decisions:- * Collector of Central Excise vs. H.M.M Limited [1995 (76) ELT 497 (SC)] * Raj BahadurNarain Singh Sugar M ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rvice receiver, the place relevant for determining location is the place where the service is "used" or "consumed". Since the actual consumption of the service has taken place in India by the companies of JCB, therefore the benefit of service rendered abroad has been received in India, and hence service tax would be payable. He also stated thatthis is a case where the services were provided from India to be consumed and used in India through the payment was made through a foreign location, whereas in actual terms, the services were neither delivered outside India nor used outside India. Consequently, merely because the payment had been received in convertible foreign exchange directly from JCB England, the service provided cannot be treated to have been exported. 4.3 Ld. AR submitted that the payment so received by the service provider for providing the services falls within the ambit of Service Tax since as per Section 65B(44) of the Finance Act, 1994, defines "service" as any activity carried out by a person for another for consideration, and includes a declared service. Further, w.e.f. 01.07.2012 all the services became taxable except the services mentioned in the negative lis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... service. In this regard the relevant Rule is reproduced as under: "Rule 2(i) (1) "location of the service receiver means:- (a) where the recipient of service has obtained a single registration, whether centralized or otherwise, the premises for which such registration has been obtained, (b) where the recipient of service is not covered under sub-clause (a): (i) the location of his business establishment; or (ii) where services are used at a place other than the business establishment, that is to say, a fixed establishment elsewhere, the location of such establishment; or (ii) where services are used at more than one establishment, whether business or fixed, the establishment most directly concerned with the use of the service; and (iv) in the absence of such places, the usual place of residence of the recipient of service. Explanation:- For the purposes of clauses (h) and (1), "usual place of residence" in case of a body corporate means the place where it is incorporated or otherwise legally constituted. Explanation 2:- For the purpose of clause (i), in the case of telecommunication service, the usual place of residence shall be the billing address ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by the Ld. Counsel for the appellant, which is reproduced below:- Sr. No. Condition Appellant's case 1. Service provider is located in the taxable territory The Appellant is located in the taxable territory. 2. Service recipient is located outside India JCB UK is located outside India 3. The service is not a service specified in the section 66D of the Act. The appellant is not rendering any service covered under the Negative List 4. The place of provision of the service is outside India The place of provision of service is outside India, in UK 5. The payment for such service has been received by the provider of service in convertible foreign exchange Payment has been received in foreign exchange 6. The provider of service and recipient of service are not merely establishments of a distinct person Appellant and JCB UK are not establishments of a distinct person. 13.1 In view of the above factual matrix, we are of the opinion that the services rendered by the appellant will qualify as export. 14. In the above context, we note that the taxability of such transactions, where rendition of service resulting in business growth in India, stand ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Service Tax (Appeals-I), New Delhi [2023 (8) TMI 246-CESTAT NEW DELHI], the Tribunal followed the Larger Bench decision (supra) and held as follows:- "27. The aforesaid discussion has been made in the context of the 2012 Rules, though the contention of the appellant is that the demand should be set aside only for the reason that the show cause notice proceeds on the footing that the 2005 Export Rules would apply. 28. Even if the 2005 Rules were to apply, the issue stands decided in favour of the appellant by a larger bench of the Tribunal in M/s. Arcelor Mittal Stainless (I) P. Ltd. vs. Commissioner of Service Tax, Mumbal-[Service Tax Appeal No. 88483 of 2014 decided on 09.06.2023). The factual position before the larger bench was that a prospective customer in India was approached by Arcelor India and the request was forwarded by Arcelor India to the foreign entity which ultimately supplied the goods to the Indian customers. For the service provided by Arcelor India to the foreign entity ie. Arcelor France, Arcelor India received commission in convertible foreign currency. The department believed that service tax was leviable on this commission received by Arcelor Indi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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