Intra-entity maintenance services are not taxable where a branch works for its head office, despite invoice cancellation and reissuance.

Maintenance and repair work performed by a branch for its head office was treated as an intra-entity activity, and a service by one part of the same business concern to itself was held not to amount to a taxable service. Cancellation of invoices and re-issuance in the head office's name did not change the essential character of the transaction or create service tax liability. The Revenue's demand was therefore not sustainable.

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Issues: Whether service tax was payable on maintenance and repair services rendered by a branch to its head office, including where invoices were cancelled and fresh invoices were raised.

Analysis: The service in question was rendered within the same business entity, from the branch to the head office. Such service by one part of the same concern to itself does not constitute a taxable service. The mere cancellation of invoices and raising of fresh invoices on the head office did not alter the essential character of the transaction so as to create a service tax liability.

Conclusion: Service tax was not payable on the branch-to-head-office service, and the Revenue's demand was not sustainable.

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