TaxTMI 
TaxTMI 
2018 (7) TMI 1010
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....L) for acting as an agent of the latter in India. As per the agreement STAR L appointed and engaged the appellant as their exclusive sales agent for (1) solicitation of advertising (2) related air time and programme sponsorship on the television channel from advertisers (ii) collection and (iii) remittance of advertisement fees. For these activities, appellants were paid commission by STAR L. Department took the view that appellants are required to discharge service tax liability on these commission amounts under the category of ‚Business Auxiliary Service‛ as defined in Section 65 (19) of the Finance Act, 1994. It also appeared to the department that an amount of cenvat credit of Rs. 99,979/- for the period 2006-07 to 2008-09 r....
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....es agency services were renderedby the appellant from India and payment for the same was received by them in foreign convertible foreign exchange. In such a situation, even if the services are provided within India, provisions of Rule 3 of Export of Services Rules, 2005 are deemed to have been satisfied, which is the law as laid down by the Tribunal in a number of decisions, for example, Gap International Sourcing (India) Pvt. Ltd. Vs CST Delhi - 2015 (37) STR 757 (Tri.-Del.), Arafaath Travels Pvt. Ltd. Vs CST Chennai - 2017 (7) GSTL 437 (Tri.-Chennai). iii) In respect of disputed credit amount of Rs. 99,979/- in respect of Mediclaim etc., the said services were availed prior to 1.4.2011 and it has been well settled in a number of ....
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.....1 From the facts on record, we are convinced that the services in question are nothing but solicitation of advertising, related air time etc. for which appellants receive a commission, hence the activity would fall within the fold of 'Business Auxiliary Service'. 5.2 However, notwithstanding the contentions put forth by Ld. A.R that the conditionalities of Rule 3 of Export of Services Rules, 2005 are not fully satisfied since services are provided only within India, we find that this controversy has now been fully settled by the case laws of higher appellate forums which have consistently held that if other requirements of Rule 3 are satisfied and the only niggle is that the services have been provided in India, this should be considere....
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....as export, if the payment has been received in convertible foreign exchange. The performance of such service in India, would not make them received/consumed in India, if beneficiary user/recipient of said service provided in relation to business or commerce, who has paid for these service and has used the service in his business, is located abroad. The position would be different if the company located abroad who has paid for the service, also has some branch/project in India and the service provided in India is meant for that branch/project - only in that case, the consumption of service would be in India and the service would be taxable in India. But if the recipient company located abroad, has no branch or project or establishment in Ind....
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....iness of the foreign company, namely, Saudi Arabian Airlines, Jeddah, Saudi Arabia. Therefore the service of the appellant will have satisfied this particular requirement in Rule 3(3) of the Rules." 5.5 Following these ratios, we are of the considered opinion that impugned services provided by appellant to STAR L will have to be treated as 'Export of Service' and hence there would be no tax liability on the same. This being so, demand of Rs. 30,38,493/- with interest thereon made in the impugned order cannot sustain and is set aside. Appeal on this score is allowed. 5.6 In respect of the remaining demand of Rs. 99,979/- alleged to be ineligible credit taken, we find that these relate to Mediclaim and Accident Insurance Policy taken fo....