Technology transfer is not consulting engineering service where the agreement shows sale of project know-how and ownership.

Transfer of the Gramdoot project, together with related technology and technical know-how, was treated as a sale and assignment of project ownership rather than consulting engineering service. Consulting engineering service requires advice, consultancy, or technical assistance rendered by a professionally qualified engineer or engineering firm. Because the agreement reflected technology transfer for consideration, not engineering advice to a client, the service tax demand could not be sustained and was set aside.

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Issues: Whether the transfer of the Gramdoot project and related technical know-how under the agreement constituted consulting engineering service so as to attract service tax.

Analysis: Consulting engineering service covers advice, consultancy, or technical assistance rendered by a professionally qualified engineer or engineering firm in one or more disciplines of engineering. On the terms of the agreement, the appellant had developed the project and transferred the project, technology, and ownership to the buyer for consideration. The transaction was one of technology transfer and sale of technical know-how, not the rendering of engineering advice or consultancy to a client.

Conclusion: The demand of service tax by treating the appellant as a provider of consulting engineering service was not sustainable and was set aside.

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