TaxTMI 
TaxTMI 
2016 (12) TMI 165
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....ssed by the Assistant Commissioner. 2. The brief facts of the case are as under : The Appellant are engaged in the marketing and sale of agrochemicals generics in overseas market as merchant trading activity. None of the goods are purchased or sold in India. The goods move from one country to another without coming to India. The Appellant had paid purchase commission, sales commission, insurance premium of goods, Legal fees to legal consultant's/ advocates for attending company's matter in foreign country, Professional charges, Service Charges for services performed outside India, advertisement expenses displayed in foreign country, Registration consultancy and registration of products in foreign country, Rent on immovab....
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....ing and sale from the establishment in India and Section 66A is concerned in the case. The services fall into the category of Clause (ii) and (iii) of Rule 3 of Taxation of Services (provided from outside India and Received in India) Rules, 2006. They have not given any explanation to establish that the services were not consumed by them for the purpose of running their business and for rejecting revenue's contention. They have not given any convincing explanation on the applicability of ratio laid down by the CESTAT's decision in Paul Merchants Ltd. 2013 (29) STR 257 (TRI). That from the documents provided by the Appellants it is clear that they only have requested for the services which were used in running t....
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....d and consumed outside India, such services cannot be taxed in India. Service tax is destination based consumption tax. He relies upon the judgment of Hon'ble Apex Court in case of Ishikawajna - Harima Heavy Industries Ltd. Vs. Dir. Of Income Tax 2007 (6) STR 3 (SC) to support his contention that tax cannot be levied without sufficient territorial nexus. He also relies upon the judgments in case of Commissioner of Income Tax, Bombay Vs. Ahmedbhai Umarbhai & Co. Bombay 1950 (SCR) 335, Bengal Immunity Co. Ltd. Vs. State of Bihar (1955) 2 SCR 603, Cox & Kings Vs. CST New Delhi 2013 - TIOL - 1907 - CESTAT - DEL, SBI Cards and Payment Services Pvt. Ltd 2016 - TIOL - 38 (CESTAT - DEL). He submits that the services availed by the....
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.... are not used for business or commerce in India and hence cannot be made liable for service tax. He submits that the establishment concerned with services are in abroad, hence, the head office in India is not liable for tax on such services. 4. On the other hand, Shri V.K.Singh Ld. Spl. Counsel appearing for the revenue submits that the services has been received by the Appellant from the persons located outside India for which the Appellant themselves made the payment in foreign currency. He submits that in such case the Appellant being the service recipient is liable for service tax. He relies upon the judgment as reported in Tata Steel Ltd. Vs. Commissioner of Service Tax, Mumbai - I, 2015 - TIOL - 1202 - CESTAT - MUM and 20....
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....order of the Appellate Commissioner that on seeking clarification by the Commissioner as to who is service provider, who is recipient, what is the service given and who has paid the amount for what reason, if no service was received by the amount paying person, the Appellant clarified that the service providers are agencies in foreign country, services are different as detailed in the Order-in-Original, appeal preferred by the revenue and their submissions. The payment has been made by Appellant because they had engaged the different agencies to provide services outside India. 8. We find that though the Section 64 envisages that the provisions of service tax extends to the whole of India. However in the instan....
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....her foreign country but the services related to such transaction was received by the Appellant who has permanent place of business in India and in whose names the bills were raised and who made the payment in foreign exchange. It is identical to case where the goods are exported outside India but the services related to such exports are availed from the overseas service provider such as commission agent etc.. In all such cases the service recipient in India i.e Exporter is liable to service tax. However all these aspects have to be gone into factually. To ascertain the status of the Appellant as the service recipient, it is necessary to verify the bills and invoices raised by the service providers, payment transactio....