Appellant contests service tax demand, citing Tribunal precedent, gets waiver and stay.

The appellant was facing a demand for service tax amounting to Rs. 2,26,86,780 for technical testing and analysis services received from foreign companies. The revenue claimed the appellant was liable for the tax, along with interest and penalty. The appellant argued that a previous Tribunal order supported their position, leading to a prima facie case for a complete waiver. The Additional Commissioner contended the services were partly performed abroad, citing a different case, but lacked clear findings on the relevant rules. Ultimately, the requirement for predeposit was waived, and a stay against recovery was granted.

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Issues:
Service tax liability on technical testing and analysis services received from foreign companies.

Analysis:
The judgment deals with the demand of service tax amounting to Rs. 2,26,86,780 from the appellant for the period from May 2006 to September 2010. The revenue claimed that the appellant is liable to pay service tax on technical testing and analysis services received from foreign companies. Additionally, interest and penalty were imposed. The services provided by the foreign companies to the appellants included laboratory services, validation of methods, sample analysis, provision of test compounds, materials, literature, data, and final reports. The appellant made payments in foreign currency for these services.

The appellant argued that the issue is covered by a previous Tribunal order in the case of Glaxosmithkline Consumer Healthcare Ltd., where a stay was granted under similar circumstances, as the services were performed abroad. After considering the facts and the previous Tribunal order, it was found that the services received by the appellants were similar to those in the Glaxosmithkline case. Therefore, a prima facie case for complete waiver was established. The Additional Commissioner argued that the service should be considered as partly performed, creating a liability. He relied on a decision in the case of Lotus Lab Pvt. Ltd. Vs. CST, Bangalore. However, it was noted that this decision related to export of services, and without clear findings on the applicability of Export of Service Rules and Import of Services Rules, it could not be considered. Moreover, the decision relied upon by the Additional Commissioner was only a stay order, not a final order. Consequently, the requirement of predeposit was waived, and a stay against recovery was granted.

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