TaxTMI 
TaxTMI 
2016 (1) TMI 442
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.... to 2008-09 to M/s.Fluent Inc. USA (referred as FI) under an agreement between M/s.Fluent Inc, USA and the appellant, i.e. M/s.Fluent India Pvt. Ltd. The royalty was paid for distribution, marketing and support of software known as FI software (referred to as products). As per the impugned order, the appellant developed software and extended the service of trained personnel for testing, documentation and use of the software under the instructions provided by M/s. Fluent Inc. Each software having a distinct customer, M/s.Fluent Inc. generated two locking codes, one for the appellant and the other for the customer. The appellant demonstrates and imparts training to the customers who use their software for their own use under specific lock cod....
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....I software (hereinafter referred to as the "Products") within the limits permissible for FIndia as per the Indian rules and regulations' 5. SOFTWARE LICENSE 5.1FI grants, without prejudice, to FIndia a non-exclusive, non-transferable license to use the software Products provided hereunder and related documentation solely for FIndia's own use. FIndia will not sell, transfer, disclose, or otherwise make available any software Product or copies thereof to others. No title to or ownership of the software Products or any portion thereof is transferred to FIndia. The license granted therein shall terminate when this Intercompany Agreement terminates and FIndia agrees, upon termination, to immediately return or, at FI's option, d....
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....reement, any distribution, sale, transfer or other disposition by FIndia of the products, including any and all physical embodiments of the Products, derivative modifications or extensions of them, is expressly prohibited. The provisions of this section shall apply to the Products as delivered by FI or as modified or enhanced by either party and to any material and information regarding the Products which has been given to FIndia prior to the date of this Agreement and shall survive expiration or termination of this Agreement or any license created hareunder. 8.3 Product Masters: FI will supply one master copy of each Product covered in this Agreement. The master copy will be in a form suitable for use by FIndia to generate copies ....
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....ht, in relation to intellectual property service. 65 (55a) - "Intellectual property right" means any right to intangible property, namely, trade marks, designs, patents or any other similar intangible property, under any law for the time being in force, but does not include copyright". 65 (55b) - (55b) "intellectual property service" means,- (a) transferring temporarily; or (b) permitting the use or enjoyment of, any intellectual property right;" Undisputedly, in terms of Section 66A, when a service is provided from outside India and received by a person in India, the recipient shall treated as the service provider and be liable to pay service tax. The question which arises is whether a tax....
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....t ought to have been based on the terms of the Agreement and on the basic statutory provisions that define "intellectual property service". To appreciate whether the service provided is related to an "intellectual property right", we note that the definition under Section 65 (55a) covers trademarks, designs, patents or any other similar intangible property under any law. The word, "namely" in the definition qualifies the above rights to show that it restricts the scope to specific intellectual property rights that are covered by specific statutes/laws. 5.2 The learned Advocate has referred to Black's Law Dictionary of English as well as Cambridge International Dictionary of English to show that the word "namely" refers to specific matter....