TaxTMI 
TaxTMI 
2015 (10) TMI 2363
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....authorities, felt that the appellant had not discharged the service tax liability for the period April 2004 to April 2006 though registered under the category of Online Information Access and/or Database Retrieval Service. After investigating in detail, show cause notice dated 11/08/2009 was issued demanding service tax liability, interest thereof and proposal for imposing penalties. The appellant contested the show cause notice on merit and submitted that the demand which has been raised is for interconnection service which is not taxable as per the Boards Circular dated 09/07/2001. The adjudicating authority did not agree with the contentions raised, confirmed the demands with interest and also imposed penalties. 3. The learned coun....
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....the Hon'ble High Court of Bombay in the case of Indian National Shipowners Association 2008-TIOL-633-HC-MUM-ST for the proposition that if a new service is brought into the statute, it will be applicable from that date. 4. Learned Departmental Representative, on the other hand, would draw our attention to the findings recorded by the adjudicating authority. He would submit that the appellant has rendered "Online Information Access and/or Database Retrieval Service" and provides interconnectivity services to other small time ISPs. The customers who are availing the services provided by small time ISPs are not registered with the appellant. It is his submission that the service tax liability on such charges recovered by the appellant from....
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....took connection from the appellant for rendering services to their clients would be liable to service tax. 6. At the outset, we find that the learned Departmental Representative as well as the learned adjudicating authority are arguing against the departments stated stand that interconnectivity charges between two ISPs are not taxable under the category of Online Information Access and/or Database Retrieval Service. We find that the Central Board of Excise and Customs vide Circular No. B.11/1/2001-TRU dated 09/07/2001 when the services were introduced has clarified comprehensively as to the liability of service tax under the head "Online Information Access and/or Database Retrieval Service". We reproduce the specific paragraph. ....
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....ions, no service of online information and database access/retrieval is involved. Therefore, e-commerce transactions will not ordinarily be covered under the service tax net. Normally, the web sites do not charge the surfers for information on sale of goods or services offered by them. If at all they do, service tax will be payable on the amount charged for providing the information. Another point raised relates to applicability of service tax on inter-connectivity services provided by one ISP to another and the charges recovered for such services. It is understood that this is done to inter connect various networks so as to reach the server where the information is stored. It is informed that interconnection of one ISP to another ....