TaxTMI 
TaxTMI 
2018 (5) TMI 983
X X X X Extracts X X X X
X X X X Extracts X X X X
....thereon, and penalties under section 76, 77 and 78 of Finance Act, 1994. Appellant is a manufacturer of bulk drugs and had made use of certain service providers located abroad on a failure to discharge liability of tax under section 66A of Finance Act, 1994 on the consideration for these services which included that of 'business auxiliary service' i.e. use of agents in those countries for promotion of their products, 'banking and financial services' for raising external commercial borrowings, and on the charges borne by banks in India for realization of export proceeds of the appellant, 'management consultancy services' for pre-inspection quality service training and other processes in the run up to obtaining approva....
X X X X Extracts X X X X
X X X X Extracts X X X X
....vices that are undeniably rendered by a foreign 'service provider' in relation to the goods sold abroad cannot be presumed to be covered by the legislative intent to tax. To tax a service using the legal fiction of import and then reimburse that tax because the service was not required for any activity within the country is an exercise in futility and is contrary to the objectives of and means devised for export promotion by the State. 3. According to Learned Counsel, the appellant was sought to be subjected to be tax as recipient of 'banking and other financial services' by erroneous interpretation of consideration made over to the service provider, that no services was provided in India for which reliance is placed on t....
X X X X Extracts X X X X
X X X X Extracts X X X X
....6. The tax sought to be levied as recipient of the 'technical inspection and certification service' is in relation to the charges paid to the statutory authorities abroad for goods that are exported to those countries and, being rendered abroad, is not liable to pay tax for which reliance has been placed the decision of the Tribunal in Intas Pharmaceuticals Limited v Commissioner of Service Tax, Ahmedabad [2009 (16) STR. 748 (Tri.- Ahmd.)] and Roha Dyechem Pvt Ltd & Anr. v. Commissioner of Central Excise, Raigad [2016-TIOL-727-CESTA-MUM]. Further arguments were placed to claim that settled law holds that in revenue neutral situation, the recourse to section 73(1) is not available. 5. In relation to second show cause notice issued....
X X X X Extracts X X X X
X X X X Extracts X X X X
....led for securing approval of US Food and Drugs Administration, it would appear that the appellant is not a recipient of 'management consultancy service' and consequently the demand under those head cannot sustain. The nature of the activity that was sought to be taxed as 'club or association service' were the payment of fees paid for membership of overseas stock exchanges. In the circumstances of a specific and distinct liability to tax under 'stock exchange service' and the inability of Revenue to connect that activity within the scope of taxable service under section 65(105) it is not permitted to attempt tax under any other taxable service. The charges paid to statutory authorities outside the country for an activ....