2015 (10) TMI 1734

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....on are the appellant herein is registered with the Department as provider of services in the category of manpower recruitment agency and supply services to their overseas client. Appellant herein organises recruitment of employees for overseas employment and charges an amount as a fee. It is the case of the revenue that appellant had undervalued the amounts received by them and extended period was invoked. Show cause notice was issued for such short payment of the service tax liability and was also seeking to demand interest and also seeking for imposition of penalties. Appellant contested the show cause notice on merit and also on limitation. The adjudicating authority after following the due process of law did not agree with the contentio....

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.... and the judgment of Honourable High Court of Bombay in the case of SGS India Private Limited 2014 (34) STR 554 (BOM) are directly on the issue raised in this appeal and are in favour of the appellant. He would submit that on limitation also they have good case in their favour. He would submit that the demands under business auxiliary services is in respect of the amounts received by the appellant which is a commission on account of ticketing, emigration charges, commission on insurance policy and discount on advertisement. He would submit that all these charges are incurred by the appellant on behalf of their clients and later on recovered and recorded as commission. It is his further submission that the small amount Rs. 20,132/-is conform....

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....e adjudicating authority that the services are rendered by the appellant in India, as representatives of appellants client come to India and participate in the selection procedure of the personnel, hence the services are rendered in India. 7. In our considered view, the findings recorded by the adjudicating authority to confirm the demand of service tax under the category of manpower recruitment and supply agency services is incorrect inasmuch as, that the employees were recruited by the appellant for clients abroad for working, salaries are paid by the clients of appellant and the services of the appellant was engaged by the foreign clients for identifying the potential employees who can work abroad. It is to be seen that though the s....

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....ort of such tests and analysis was sent abroad. The clients of the respondent were foreign clients, paid the respondent for such services rendered, in foreign convertible currency. It is in that sense that the Tribunal holds that the benefit of the services accrued to the foreign clients outside India. This is termed as 'export of service'. In these circumstances, the Tribunal takes a view that if services were rendered to such foreign clients located abroad, then, the act can be termed as 'export of service'. Such an act does not invite a service tax liability. The Tribunal relied upon the circulars issued and prior thereto the view taken by it in the case of KSH International Pvt. Ltd Vs. Commissioner and B.A. Research India Ltd. ....