Software testing excluded from technical inspection and certification service at the interim stage, with pre-deposit waived and recovery stayed.

Software testing undertaken as part of software development was held, on a prima facie basis, not to fall within technical inspection and certification service at the interim stage. The Tribunal treated the facts as materially similar to an earlier decision and noted that the later Finance Act amendment operated prospectively. Waiver of pre-deposit was granted and recovery of the demanded amount was stayed pending appeal.

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Issues: Whether the appellant was entitled to waiver of pre-deposit and stay of recovery on the prima facie view that software testing undertaken by it did not fall within the scope of technical inspection and certification service.

Analysis: The Tribunal found that the facts were prima facie identical to the earlier decision concerning software testing as an integral part of software development. It held that the activity did not, at least at the interim stage, fall within the category of technical inspection and certification service. The subsequent amendment in the Finance Act was noted to be prospective in operation.

Conclusion: The appellant was granted waiver of pre-deposit and recovery of the demanded amount was stayed pending disposal of the appeal.

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