TaxTMI 
TaxTMI 
2014 (5) TMI 459
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....is not applicable in the facts of this case?" 2. This Court has heard learned counsel Mr. Darshan Parikh for the respondent, who has assailed the order of the Tribunal. 3. The short issue relates to recovery of Service Tax in relation to the service provided by an individual residing outside India prior to 18-4-2006. 4. Briefly stating the facts, an intelligence was gathered that the service provider M/s. Unimark Remedies Limited had appointed foreign based agent for promotion of export of pharmaceutical products. They paid commission to agent and the services were covered under the ambit of service tax net in the category of Business Auxiliary Services. As no service tax registration was paid by the service provider....
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.....T.R. 15 (Guj.)] as well as Tax Appeal 1882 of 2010 decided the said issue at length holding the same in favour of the Revenue. It will be apt to reproduce the observations from Tax Appeal No. 1300 of 2010 as under :- "Having thus heard learned Counsel for the parties and having perused orders on record, we find that undisputedly with effect from 18-4-2006 Section 66A has been introduced in Finance Act, 1994 which reads as under : "66A. (1) Where any service specified in clause (105) of section 54 is, - (a) provided or to be provided by a person who has established a business or has a fixed establishment from which the service is provided or to be provided or has his permanent address or usual place of residence, in a country ot....
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....th the period prior to 18-4-2006 when said Section 66A was not in the Statute Book. Rule 2(1)(d)(iv) of the Service Tax Rules, 1994 is at the relevant time read as under : "(iv) in relation to any taxable service provided or to be provided by a person, who has established a business or has a fixed establishment from which the service is provided or to be provided, or has his permanent address or usual place of residence, in a country other than India, and such service provider does not have any office in India, the person who receives such service and has his place of business, fixed establishment, permanent address or, as the case may be, usual place of residence, in India;" This Rule for the period prior to 18-4-2006 and; in....
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....y virtue of provisions contained in Rule 2(1)(d)(iv) in the Service Tax Rules, recipient of Service Tax could not be made liable to pay the tax. It is of course true that in the concluding portion, the Bench observed that the person who receives service outside India from a person who is non-resident cannot be made to pay Service Tax. To our mind, however, this is not the ratio of the decision and the entire decision is based on the ratio laid down by the Apex Court in the case of Laghu Udyog Bharti (supra). Bombay High Court's observations relevant for our purpose may be noted thus : "20. It appears that a similar provision in the rules was made applicable by the Government in relation to the Clearing Agents by making customers ....
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....services received from abroad by a person belonging to India are taxed in the hands of the Indian residents. In such cases, the Indian recipient of the taxable services is deemed to be a service provider. Before enactment of Section 66A, there was no such provision in the Act and therefore, the Respondents had no authority to levy Service Tax on the members of the petitioners-association." We also notice that Delhi High Court in case of Unitech Ltd. (supra) relying on decision of the Bombay High Court in the case of Indian National Shipowners Association (supra), deleted the tax demand from assessee who was a recipient of taxable services in the nature of architectural services from a non-resident. In view of the above judicial pronou....