TaxTMI 
TaxTMI 
2016 (6) TMI 1108
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.... Reverse charge mechanism, on the premise that it ought to have discharged service tax under the head of Intellectual Property Services (IPR for short) on the amount remitted by it to various overseas entities towards the right to use/enjoy confidential/technical know-how and patents held by such overseas entities. 2. It is an undisputed fact that out of the six different agreement in terms of which the right to use/enjoy confidential/technical know-how and patent have been granted, only the patent in respect of Investa Technologies s.a.r.l., is registered in India under the Patents Act 1970. In respect of the remaining agreements, there is no patent, which is registered under the Patents Act, 1970. 3. The Appellant had resisted the d....
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....ation was not invokable inasmuch as the entire transaction was revenue neutral. 4. The Learned AR appearing on behalf of the revenue has reiterated the findings of the Revenue and submitted that the service were aptly classified under IPR and that the extended period of limitation has rightly been invoked. 5. We have heard the submissions of both sides. The primary issue that arises for determination is whether an Intellectual Property Right, which is not recognised under the Indian laws for the time being in force would constitute an Intellectual Property Right, the temporary transfer or the right to use or enjoyment of which is liable to tax under the head of IPR services. 6. While deciding this we have to bear in mind that India....
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....an intangible property. There would have been no need for it to qualify the same with a recognition under any law for the time being in force. 7. It would be clearly incongruous to suggest that an intellectual property right such as a patent or a trade mark is not protected or recognised by the Indian Law, yet the grant of the right to use or a temporary transfer of such a patent or trade mark, which is otherwise not recognised in Indian as a Intellectual Property Right would attract liability to service tax under the head of IPR services. The legislature has in accordance with the global treaty for protection of IPR world over laid down the agreed procedure that any inventor if required to follow, so as to have the patent and trademarks....
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....n force were alone chargeable to service tax. It was further clarified that IPRs like integrated circuits or undisclosed information, which was not recognised under Indian laws would not be covered under the said taxable services of IPR. We are in complete agreement with this clarification issued by the CBEC and do not find any reason to disagree with the same. In view of the above, there can be no liability to tax under the head of IPR services in respect of an Intellectual Property Right that is not recognised by the law in India. In the facts of the present case except for the Patent with respect to Investa Technologies S.A.R.L. which was recognised under the Patents Act 1970 in India none of the alleged Intellectual Property Rights are....
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....ppellant as Intellectual Property Right Services. We find no clue at all in the records as to which type of Intellectual Property Right is being assigned to the Technical know-how received by the Appellant. It is obvious from the definition of Intellectual Property Right that the right has to be a specific Right under a specific Law. Examples are given under the definition such as the Trade Mark which is a right provided under Trade Marks Act. Similarly the right mentioned as design in the definition is a right under the Designs Act. Therefore we find that the technical know-how received by the Appellant and the royalty payment made by the Appellant to Unisys is nowhere established to result from the use of any Intellectual Property....
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....basis over a period of time cannot be a ground for levying service tax merely with reference to the date on which payments were being made. We find that during the relevant period the issue as to whether a transaction is leviable to service tax and if so at what rate was required to be reckoned with reference to the date when the service was rendered and not with reference to the date on which payment is made. The law in this regard is settled by the decision of the CESTAT reported in 2008 (10) STR 243 which was affirmed by the Hon'ble Gujarat High Court in the Appellants own case reported in 2010 (19) STR 807 as also by the Hon'ble Delhi High Court in the case of CCE vs Consulting Engineering Services India (P) Ltd 2013 (30) STR 586.As th....