Appeal granted in service tax case on technology transfer fees

The Tribunal allowed the stay application and appeal in a case concerning the levy of service tax on technology transfer fees under Consulting Engineer Services. The appellants contested the tax imposition, arguing that the services did not fall under consulting engineer services. Despite the Commissioner's differing view, the Tribunal held that he should have followed previous Tribunal decisions, which supported the appellants' position. The Tribunal emphasized the importance of consistency in decision-making and granted relief based on established precedents.

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Issues involved: Stay application and appeal regarding levy of service tax on technology transfer fee under Consulting Engineer Services.

Summary:

Issue 1: Levy of service tax on technology transfer fee
The appellants entered into agreements with foreign companies for technology transfer, paying fees exceeding &8377;1 Crore. Revenue levied service tax under Consulting Engineer Services u/s 65(31) of the Finance Act, 1994. Appellants contested, citing the services under technology transfer agreements do not fall under consulting engineer's service. Tribunal noted various rulings supporting the appellants' position.

Issue 2: Commissioner's view
Original authority accepted Tribunal rulings and dropped proceedings. However, on revision, the Commissioner disregarded the judgments and took a different view. Tribunal held that the Commissioner should have followed the Tribunal's decisions, as he was bound by them. The Commissioner's independent view without considering the judgments was deemed incorrect in law. It was also pointed out that the Commissioner had dropped proceedings for another unit in a similar situation, indicating inconsistency in decision-making.

In conclusion, the Tribunal allowed the stay application and appeal, providing consequential relief, as the issue was already covered by previous Tribunal decisions, and the Commissioner was expected to adhere to those precedents.

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