TaxTMI 
TaxTMI 
2019 (5) TMI 234
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....ioner (Appeals) vide impugned order dated 21.05.2012 upheld the same. Hence, this appeal. 3.1 On behalf of the appellant, Ld. Advocate Ms. Krithika Jaganathan appeared and argued the matter. The appellant receives various services from foreign service providers situated abroad. The transactions on which the demand is raised are described as under : (a) Services of Online Maintenance of Software: The appellant procured services of online maintenance of software from M/s. LHS Verwaltungs GMBH & Co., Germany. The scope of services included upgradation of existing software, maintenance and support for installed software, repairs, etc. (b) Services of International Outbound Roaming: The appellant received services of International Outbound Roaming facility from Foreign Telecom Operators such as M/s. Teleglobe Canada, Comfone, etc. Under an International Roaming Agreement, the appellant's subscribers could avail and utilize the network services of the Foreign Telecom Operator for the time that the subscriber was outside India (within the network territory of the Foreign Telecom Operator). (c) Services of Development and Supply of Value-Added Content: The appellant received ser....
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....ant that the Hon'ble High Court of Madras in M/s. Kasturi & Sons Ltd. Vs. Union of India reported in 2011 (22) S.T.R. 129 (Mad.) has declared this Circular dated 07.10.2005 to be ultra vires and has quashed the same. Therefore, the demand of service tax on maintenance and repair of software for the period prior to 01.06.2007 is unsustainable and requires to be set aside. 3.4.1 The second issue is with regard to the demand of service tax under 'Business Support Services'. The demand has been confirmed on the activity of International Outbound Roaming services received by the appellant from Foreign Telecom Operators abroad. The Department alleges that the Foreign Telecom Operators have rendered Business Support Services to the appellant. The demand under this category is incorrect. The cellular mobile telephone services including provision of access to and use of switched and non-switched networks for the transmission of voice, data and video, inbound and outbound roaming services to and from national and international destinations were introduced as 'Telecommunication Services' with effect from 01.06.2007. Therefore, the very same activity cannot be made liable to service tax unde....
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....erefore, the issue in this case is also revenue neutral. The penalties in this regard may be set aside. 3.6 She therefore prayed that the appeal may be allowed. 4.1 Ld. AR Ms. T. Usha Devi appearing on behalf of the respondent supported the findings in the impugned order. She submitted that the first issue is with regard to the demand of service tax under Management, Maintenance or Repair Services. The Board vide its Circular dated 07.10.2005 has clarified that computer software is leviable to service tax with effect from 09.07.2004 i.e., the day the exemption granted to services in relation to maintenance and repair of computers, computer software and computer peripherals by Notification No. 20/2003-ST was rescinded vide Notification No. 07/2004-ST. The definition of Management, Maintenance or Repair Services contains an Explanation which clarifies that "goods" includes computer software. The appellants are therefore liable to pay service tax on the online maintenance and repair services of software received by them from the service providers situated outside India. 4.2 The second issue is with regard to the demand under Business Support Services. It is not disputed that the....
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....e Tribunal in the case of M/s. Phoenix IT Solutions Ltd. - 2017 (52) S.T.R. 182 (supra) has discussed the very same issue and held as under : "6. In view of the same discussions and conclusions, we hold that for the period prior to 1-6-2007, the activity of software maintenance provided by the appellant to APEPDCL will not be liable to service tax liability. However, for the period subsequent to 1-6-2007, said activity will definitely be liable to service tax under the management, maintenance, repair services. The impugned order will stand modified to that extent. Considering that the issue has already been in agitation and that periodical show cause notices have been issued to the appellant, issue being one of interpretation, the imposition of penalty under Section 76 on the appellant is hereby set aside. The matter is remanded to the original authority for the limited purpose of calculating the tax liability of the appellant for the said services for the period 1-6-2007 till 31-3-2008. It is clarified that the said tax liability worked out will be payable along with interest. At this juncture ld. Counsel submits that the said tax liability has been already calculated by them a....
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....nder the category of Business Support Services, especially when the activity is covered under the definition of 'Telecommunication Services'. 7.2 The Commissioner (Appeals) in paragraph 24 has discussed that the services provided by the Foreign Telecom Operators are in the nature of "identification/authentication of customer desirous of having international roaming facility". That these are, in fact, Business Support Services and would not fall under the category of Telecommunication Services. The appellant has submitted that the non-resident service providers (Foreign Telecom Operators) providing signalling services outside India are not holding licence under the first proviso to Sub-section (1) of Section 4 of the Indian Telegraph Act, 1885. These service providers are therefore not a 'telegraph authority' as defined in Section 65(111) of the Finance Act, 1994. Hence, the service provided by the non-resident service providers would not be liable to service tax as Telecommunication Services. The legislature has sought to tax the Telecommunication Services provided only by a 'telegraph authority'. The Telecommunication Services provided by a person other than a telegraph authorit....