Information technology software services were taxable from 16.05.2008, and a contrary Cenvat credit challenge failed.

Services relating to information technology software were made taxable under clause (zzzze) of Section 65(105) of the Finance Act, 1994 from 16.05.2008, but they were not treated as non-services before that date. The Karnataka HC rejected the argument that the activity was not a service at all prior to 16.05.2008 and noted that this contention had not been raised before the Tribunal. On that basis, no appellate interference was warranted with the Tribunal's remand for reconsideration of the refund claim on limitation.

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Issues: Whether the Tribunal's remand for reconsideration of the refund claim on limitation required interference, and whether services relating to information technology software were not services at all prior to 16.05.2008 so as to affect Cenvat credit entitlement.

Analysis: The Court noted that clause (zzzze) of Section 65(105) of the Finance Act, 1994 made services in relation to information technology software taxable with effect from 16.05.2008, but rejected the contention that such services were not services at all before that date. It also recorded that this contention had not been raised before the Tribunal. In these circumstances, no case for appellate interference with the remand order was made out.

Conclusion: The contention that the services were not services at all prior to 16.05.2008 was rejected, and the appeal was dismissed.

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