Reverse charge applies to CRS data services; complete waiver of pre-deposit was refused pending appeal.

The tribunal held that the definitions of online information and database access or retrieval service were broad enough to cover transmission and retrieval of booking and passenger data through a computer network. On the facts, the appellant received CRS-based services from foreign providers and made payments to them, so the demand was covered by the reverse charge framework. The contention that the appellant was only a participant and not a recipient was rejected at the interim stage. Complete waiver of pre-deposit was declined; pre-deposit was directed for the demand relating to the normal period, and the balance was stayed pending appeal.

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Issues: (i) Whether the appellant had made out a prima facie case for complete waiver of pre-deposit and stay of recovery in respect of service tax demanded on services received from foreign CRS companies.

Analysis: The statutory definitions of online information and database access or retrieval service were held to be wide enough to cover transmission and retrieval of data through a computer network. On the facts, the appellant accessed and received booking and passenger-related data through the CRS system, made payments to the foreign service providers, and thus fell within the reverse charge framework under Section 66A. The plea that the appellant was only a participant and not a recipient of service was rejected at the interim stage. The plea of limitation was not gone into finally for this purpose, and the financial hardship plea was considered only in relation to the extent of pre-deposit and stay.

Conclusion: Complete waiver was declined. The appellant was directed to make a pre-deposit of the service tax demand relatable to the normal period, and on compliance the balance demand was ordered to remain stayed during the pendency of the appeal.

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