TaxTMI 
TaxTMI 
2014 (4) TMI 219
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.... FOR THE RESPONDENT : SHRI S.CHAKRABORTY,A.R.(ASSTT.COMMR.) JUDGEMENT Per Dr. D. M. Misra; This is an Application for waiver of predeposit of Service Tax of Rs.83.11 lakh and equal amount of penalty imposed under Section 78 and penalty of Rs.5,000/- under Section 77, of the Finance Act, 1994. The service tax demand has been confirmed against the Applicant on the ground that the Applicant had received the taxable value of Rs.8.98 crore from M/s. Tata Tea Ltd. on account of 'Goodwill', right to use the name, 'Kanan Devan' in favour of M/s. Kanan Devan Hills Plantations Company Pvt. Ltd. (here-in-after referred to as KDHP), which falls under the category of the taxable service, namely, 'Intellectual Property Service',as defined unde....
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....evan Tea', which has been in use by the Applicant. It is his submission that no separate consideration has been identified in the corporate name's licensed Agreement dated 24.09.2005, whereby the 'Goodwill' in the name & style, 'Kanan Devan' has been transferred to KDHP for a period of 30 years. He submitted that the subsequent Agreement dated 24.09.2005 which allowed using the 'Goodwill' name, 'Kanan Devan', cannot, therefore, be given effect to. 2.2. The ld. Advocate has also referred to the Board's Circular F.No.B-2/8/2004-TRU dated 10.09.2004, to advance his argument that only those 'Intellectual Property Rights' (except copyright) that are prescribed under the law, for the time being in force, to come under the category of 'Intellec....
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.... his submission that the 'Goodwill', viz. 'Kanan Devan' allowed by the Applicant to be used by KDHP, would squarely fall under the definition of 'Intellectual Property Right.' He has referred to the Circular issued by the Board dated 10.09.2004, wherein at para 9.1, it is mentioned that 'Goodwill' is also an 'Intellectual Property'. The ld. AR for the Revenue submitted that the subsequent Agreement dated 24.09.2005 clearly indicates that there is no absolute transfer of the 'Goodwill' i.e., 'Kanan Devan' in favour of the transferee, KDHP, but only for its use for a period of 30 years. Hence, the amount of Rs.8.98 crore which had been earmarked and subjected to 'stamp duty' mentioned in the Deeds of Transfer dated 30.03.2005 and 02.07.2005, ....
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....nsideration of Rs.8.85 Crores towards intangibles including goodwill, right to use 'Kanan Devan' as part of the name of the Purchaser, and towards Technical Support in infrastructure and welfare facilities. 4.1. It is not in dispute that the Applicant had considered Rs.8.98 crore as receipt towards the intangibles, including 'Goodwill', right to use 'Kanan Devan' as part of the name of the purchaser and towards the technical support on the infrastructural and welfare facilities. Similarly worded condition has been inserted in the Deed dated 02.07.2005 for an amount of Rs.0.13 crore. The Agreement dated 24.09.2005 between the Applicant and KDHP stipulates at clause (2) stating as - 'Subject to the provisions of this Agreement, TTL hereby ....
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....consequently, it is chargeable to service tax under the taxable services, 'Intellectual Property Services'. We find from the observation of the ld. Commissioner that after giving a detailed finding against each and every argument of the Applicant, he had arrived at a conclusion that the services rendered by the Applicant, would fall under the category of 'Right to Intellectual Property'. We also find that the ld. Commissioner recorded reasoning for invoking the extended period of limitation. The question of applicability of the extended period of limitation is a mixed question of law and facts, and at this stage, we are prima facie satisfied that the ld. Commissioner's reasoning invoking the extended period is apparently convincing and we a....