TaxTMI 
TaxTMI 
2013 (7) TMI 178
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....fore, they are taken up together for consideration. 2. The appellant, M/s Vodafone Cellular Essar Ltd., Pune, provided telecom services in India to international in-bound roamers registered with foreign telecom network operators but located in India at the time of providing of the said services and claimed rebate on the ground that the payment was received in convertible foreign exchange from the foreign telecom network operators and the services rendered should be treated as export of service under the Export of Service Rules, 2005. Their claims were rejected by the adjudicating authority against which they filed appeals. The lower appellate authority in the impugned orders held that the service provided by the Indian telecom operator t....
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....or to use its Public Mobile Network. Thus as per the agreement, the service is rendered to the foreign telecom service provider who is charged for the services and not to the subscriber of the foreign telecom service provider. The consideration is received in foreign convertible exchange and hence, the transaction is one of export as defined in Export of Service Rules, 2005. * Export of Services Rules, 2005 classifies the taxable services into three categories and the telecommunication service provided by the appellant falls under category III. As per rule 3(1)(iii) of the said Rules, this category deals with such services when provided in relation to business or commerce, be provision of such services to a recipient outside....
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....ndia so long as the benefits of these services accrue outside India. In terms of the above clarification, the services rendered by the appellant qualify as "exports". * As per the UK VAT Circular vide VATPOSS15100, the place of supply of telecommunication services is where they are used and enjoyed when supplied and when such services are provided by a non-EC provider to a U.K. Customer or a non-business customer in another Member State, to the extent that effective use and enjoyment takes place in the UK (such element being subject to UK VAT). Similarly, as per Tax Laws Amendment Bill 2010 of Australia, GST relief for telecommunication supplies for global roaming in Australia has been provided and telecommunication services....
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....d enjoyment of service has been obtained. Accordingly, he pleads for upholding the order. 5. We have carefully considered the submissions made by both the sides. As the issue is of a recurring nature and involves interpretation of law, we are taking up the appeals for consideration and disposal after waiving the requirement of any pre-deposit. 5.1 We have perused the agreement entered into between the appellant and the foreign telecom service providers. As per the said agreement, the appellant has agreed to provide telecom services to the customer of the foreign telecom service provider while he is in India using the appellant's telecom network. The consideration for the service rendered is paid by the foreign service provider. There ....
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....onstrued as export when provided in relation to business or commerce to a recipient located outside India and when provided otherwise to a recipient located outside India at the time of provision of such service. The additional conditions required to be satisfied are such services as are provided from India and used outside India; and consideration for the service rendered is received in convertible foreign exchange. As observed earlier, the service is rendered to a foreign telecom service provider who is located outside India and, therefore, the transaction constitutes export and we hold accordingly. 5.3 The Board's clarification vide Circular no. 111/5/2009-ST dated 24.02.2009 makes this position very clear. Para 3 of the Circular whic....
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....ivities take place in India so long as the benefits of these services accrue outside India...." Thus what emerges from the above circular is that when the appellant rendered the telecom service in the context of international roaming, the benefit accrued to the foreign telecom service provider who is located outside India since the foreign telecom service provider could bill his subscriber for the services rendered. This is the practice followed in India also. When an Indian subscriber, to say, MTNL/BSNL goes abroad and uses the roaming facility, it is the MTNL/BSNL who charges the subscriber for the telecom services including service tax, even though the service is rendered abroad by the foreign telecom service provider as per the agree....