Appellant's Services to Singapore Company Qualify as Export of Service

The Tribunal held that services provided by the appellant to a company in Singapore qualify as an 'export of service,' following precedent where services used outside India were considered exports. As there was no direct agreement with Indian customers and services were for the Singapore company, the Tribunal set aside the order demanding service tax, allowing the appeals with consequential relief.

---

---

Issues involved:
The judgment involves the issue of the leviability of service tax on services rendered by the appellant to a company in Singapore under a Marketing Service Agreement, and whether these services qualify as 'Business Auxiliary Services' under the Finance Act, 1994.

Issue 1 - Leviability of Service Tax:
The appellant entered into a Marketing Service Agreement with a company in Singapore for marketing and sales promotion services in India. The Revenue alleged that these services were taxable under 'Business Auxiliary Services' and issued a show cause notice for recovery of service tax. The demand was confirmed with interest and penalty, leading to the present appeal.

Issue 2 - Comparison to Precedent Case:
The appellant argued that the issue of leviability of service tax on similar services was decided in a case involving M/s Arcelor Mittal Stainless India Pvt. Ltd. The appellant contended that the services provided were similar to those in the precedent case, where the Larger Bench decided in favor of the assessee. The appellant sought a similar decision in their appeal based on the precedent.

Judgment:
After considering the submissions from both sides and examining the facts, the Tribunal observed that the services provided by the appellant to the company in Singapore should be considered as an 'export of service.' The Tribunal applied the principles laid down by the Larger Bench in the precedent case, where it was established that services provided from India but used outside India qualify as an export of service. As there was no direct agreement between the appellant and prospective customers in India, and the services were carried out for the company in Singapore, the Tribunal concluded that the impugned order passed by the Commissioner could not be sustained. Therefore, the Orders were set aside, and the appeals were allowed with consequential relief, if any, as per law.

---