Service Tax Waiver Request Granted on Manpower Supply vs. Software Development Classification

The applicant sought a waiver of pre-deposit of service tax, penalty, and interest. The Commissioner (Appeals) found the applicant's services aligned more with manpower supply than software development, based on billing practices. The applicant was directed to pre-deposit Rs. 3 lakhs, with the remaining amount waived upon compliance. Recovery was stayed during the appeal process, subject to compliance by a specified date.

---

---

Issues involved: Application for waiver of pre-deposit of service tax, penalty, and interest u/s service tax laws.

Summary:
The applicant filed an application seeking waiver of pre-deposit of service tax, penalty, and interest amounting to Rs. 7,48,822. The impugned order revealed that the applicant was involved in providing services categorized under Man-power Recruitment or Supply Agency Service. The applicant claimed they were developing software as per instructions from M/s. Infosys Technologies Ltd., not supplying manpower. However, the Commissioner (Appeals) heavily relied on a previous Tribunal decision related to a similar case. The applicant failed to provide evidence supporting their claim of supplying software, as billing was based on the manpower provided to M/s. ITL, working under their supervision. This indicated a prima facie case of supplying manpower rather than software. Consequently, the applicant was directed to pre-deposit Rs. 3 lakhs within six weeks. Upon compliance with this directive, the pre-deposit of the remaining amount was waived, and recovery stayed during the appeal process. Compliance was to be reported by 26.02.2013.

---