TaxTMI 
TaxTMI 
TaxTMI 
2015 (10) TMI 2410
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.... located at Chennai, Hyderabad, Gurgaon for which they have obtained centralised service tax registration from Chennai-III Central Excise Commissionerate. Based on the intelligence that appellants were rendering various maintenance of software services to various banks and also providing persons, a SCN dt. 18.10.2007 was issued to the appellant demanding service tax of Rs. 83,93,309/- on maintenance of computer software service and service tax of Rs. 16,68,679/- under man power recruitment agency service along with interest and also proposed for penalty. The adjudicating authority in the impugned order confirmed the demand of service tax of Rs. 83,93,309/- and Rs. 16,61,679/- as service tax under respective services and also appropriated an....
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....t. Ltd. Vs CST Chennai - 2014 (33) STR 393 (Tri.-Chennai) where the Tribunal by relying the above Hon'ble Madras High Court decision allowed the appeal and held that maintenance of computer software cannot be subjected to service tax under the entry of Management and Maintenance or Repair service prior to 1.6.2007. He also relied the Principal Bench decision of the Tribunal in the case of VGL Softtech Ltd. Vs CCE Jaipur - 2013 (31) STR 123 (Tri.-Del.). 3.2 On the second issue, viz. man power recruitment or supply agency service, he submits that they are not covered under the definition of man power recruitment or supply agency service and they are providing IT services which is a specialized service. They are not recruiting any person and....
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....ftware service. He relied Supreme Courts decision in the case of TATA Consultancy Services Vs State of Andhra Pradesh - 2004-TIOL-87-SC-CT-LB. 4.1 On the man power recruitment and supply agency service, Ld. A.R submits that the adjudicating authority has rightly confirmed the service tax. He drew our attention to paras 21 & 27 of OIO where the appellants have admitted providing of man power service and also paid service tax accordingly. Regarding cenvat credit on the input services service, he submits that appellants are not eligible for cenvat credit as input services were not related to "output services" which is maintenance of computer software services. 5. In rejoinder, learned advocate countered the arguments and submits that Hon'....
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....8.2003 which exempted service tax on the maintenance of software services and the said notification was withdrawn/rescinded by Notification No.7/2004 dt. 9.7.2004 and concluded that service tax is leviable on maintenance or repair of computer systems which includes maintenance of software. The Board has clearly clarified that software is considered as "Goods" under section 65 (64) of the Finance Act towards "Maintenance or Repair Service". The said Finance Act, 2007 brought an amendment by way of Explanation under "Management and Maintenance or Repair Service" that for the purpose of this clause, "goods" includes computer software. We find that the issue is already settled by the Hon'ble High Court of Madras in the case of M/s.Kasturi &....
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.... to the amendment brought under Section 65 of Finance Act. Therefore, the amendment cannot have retrospective effect prior to 1.6.2007. Accordingly, service tax demand in so far as maintenance of computer software service under "Maintenance or Repair Service" is liable to be set aside. 8. As regards service tax demand on Man Power Recruitment or Agency Supply Service, the adjudicating authority discussed the issue at length in his findings. The definition of "Man Power Recruitment or Agency Supply Service" is wide enough to include any commercial concern engaged in providing any service, directly or indirectly in any manner for recruitment or supply of manpower, temporarily or otherwise to a client. The appellant's contention is that t....