Exported-service treatment for segmental work may justify interim relief and waiver of pre-deposit under the circular.
A segmental service provider may prima facie qualify for exported-service treatment where it performs only part of the work ultimately rendered to foreign clients through a principal recipient that receives foreign exchange. On that basis, the Board's circular on such services was found prima facie applicable, supporting waiver of pre-deposit and stay of recovery for the interim period. The document treats the appellant's work as a secondary service forming part of the export chain, rather than an independent domestic service, and grants interim relief on that limited assessment.
Issues: Whether the appellant had made out a prima facie case that the services rendered were covered by the Board's circular and could be treated as exported services, warranting waiver of pre-deposit and stay of recovery.
Analysis: The appellant, a chartered accountant firm, performed only a portion of the work undertaken by DHS for foreign clients. The invoices and supporting details indicated that DHS had received consideration in foreign exchange from the foreign clients, and the appellant's work formed part of the service ultimately rendered by DHS. On this basis, the service appeared to be a secondary service rendered to DHS as the primary service provider. The Board's circular dealing with such services was found to be prima facie applicable, and the appellant was held to have established a prima facie case.
Conclusion: The appellant was entitled to waiver of the adjudged pre-deposit and stay of recovery for the specified period.
Final Conclusion: Interim relief was granted on a prima facie assessment that the appellant's activity fell within the exported-service treatment contemplated by the circular.
Ratio Decidendi: Where a service provider performs only a segment of the work that forms part of an exported service supplied to a foreign client, and the principal recipient receives foreign exchange, the segmental service may prima facie be treated as a secondary service for purposes of export treatment and interim relief.
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AI Drafter ✕
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