Taxability - import of services

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Co. A in India has got a software for perpetual use by its foreign collaborator on a one time lump sum payment basis. Updates will be given either free for 3 years and after that on annual payment. Will the payments be taxable under import of services ?

AI Summary

Software Purchase Exempt from Service Tax: No Tax on Sale, Implementation, or Updates Under Import of Services Rules. Co. A in India acquired software for perpetual use from a foreign collaborator through a one-time lump sum payment. Updates are provided free for three years and then require annual payments. The query is whether these payments are taxable under import of services. The response clarifies that currently, service tax does not apply to the sale, implementation, or update charges of the software. Therefore, there is no service tax liability under import of services for this transaction.