TaxTMI 
TaxTMI 
2008 (10) TMI 35
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....awings along with interest and imposition of penalty under Sections 76 and 77 of the Act. 2. Heard both sides. The learned Advocate also filed a written submission at the time of hearing which has been taken into account. 3. The relevant facts, in brief, are as follows: a) The appellant is a company incorporated in Japan and has a project office at Jamshedpur. They entered into agreement with TISCO to supply the design and drawing to the office of TISCO/their consultant M/s M.N. Dastur Co. Ltd., Calcutta in connection with installation of their 'Coupled Pickle Line and Tandem Cold Mill'. As per the contract the drawings and designs are required to be as per the technical specifications given by TISCO. b) The relevant porti....
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....firmed the demand of duty under the head "consulting engineering service". d) The Commissioner's order relates to demand of duty on other services also and the total demand of tax confirmed is Rs.4,55,10,464/-. However, the dispute is restricted to the demand under the category of 'consulting engineer' relating to design and drawing supplied from Japan. The prayer in the appeal is accordingly, the alleged service tax demand of Rs 2,79,30,192/- on foreign designs and drawings along with interest and penalty under Section 76 and 77 of the Act be set aside/ dropped." 4. The learned Advocate contests the demand on the following grounds: a) The drawings and designs have been prepared in Japan and they were provided/delivered in a media ....
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....nvocation of extended period of limitation is not sustainable. The Commissioner has rightly held that no penalty is imposable on them holding that there were valid reasons for invoking Section 80 of the Act. Having held that no penalty is imposable under Section 78 and provisions of Section 80 are attracted, confirmation of the demand relating to period from 1999 to 2002 in pursuance of show cause Notice dated 20.4.2005 invoking extending time limit was not justified. 4. The learned DR reiterates the findings of the Commissioner. He submits that the claim that the drawing and designs are goods may not be accepted. They are primarily services rendered and the services have been rendered in India only by delivering the said designs and dra....
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....formation admitted by SOJITZ were deemed and required to be utilized in the territory of India i.e. at Jamshedpur. SOJITZ had never disputed this fact that such designs and drawings were not delivered and utilised in India. The supply of design and drawings could not have been completed without the delivery of the same in India. It is also not the case of SOJITZ that the contract is limited to the supply of designs and drawings in Japan only when the requisite technical information is also a par and parcel of the said designs and drawings. v) Hence , I hold that such services were deemed to have been provided in the territory of India. vi) The issue now is whether such services are 'taxable services' in the ambit of definition of 'CES....
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....ment of the agreed 'price'. These designs and drawings may have technical inputs in them. However, if a question is asked as to whether these designs and drawings which were sent as a parcel or through courier would attract the provisions of Customs Act, the answer is in the affirmative. 5.3. Under the above circumstances, the view canvassed by the learned Advocate that the drawings and designs should be treated as goods cannot be considered unreasonable. Such a view has been upheld in the case of Kirloskar Electric Co.Ltd. cited supra with the following findings: "4. On a careful consideration, we notice that the authorities have considered the assignment of agreement for transferring the rights therein for supply of drawings, ....