The appellant's services cannot be classified as "Business ...

Software Support Services Face Tax Liability Despite Claims of Export.

Case Laws     Service Tax

October 14, 2024

The appellant's services cannot be classified as "Business Auxiliary Service" under the Export of Service Rules, 2005, and hence are not exempt from service tax. The services provided by the appellant relate to maintenance, repair, commissioning, installation, training, testing, certification, and IT software, which are not marketing or sales promotion services. Since the services are provided and used in India, they do not qualify as export of services. The extended period of limitation was rightly invoked as the audit revealed suppression of correct valuation. The penalty u/s 78 and interest on delayed payment are upheld. The appellant's services do not fall under "Commission Agent" in "Business Auxiliary Service" as per Section 65(19) and are not entitled to export service exemption as they are not used outside India. The Tribunal affirmed the impugned order, dismissing the appeal.

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