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2023 (2) TMI 827
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....,77,136/- on telecom and broadband services received by them from a foreign based company M/s. Verizon and Quest through M/s. Etch Inc USA, during 2008 -09. A show cause notice dated 29.09.2010 was issued to the appellant proposing recovery of service tax amounting to Rs. 10,77,136/- under first proviso to section 73 (1) of FA, 1994 along with interest under section 75 of the Finance Act, 1994. The show cause notice also proposed penalty to be imposed under section 76, 77 & 78 of the Finance Act, 1994. The Adjudicating Authority dropped the proceeding of the show cause notice on the ground that telecommunication service is taxable only if it is provided to any person who has been granted a Licence under first proviso to section 4(1) of the ....
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....ervice from abroad. In normal course assessee who received the service from abroad is liable to pay the service tax in terms of Section 66 A read with Rule 2 (1) (d)(iv) of Service Tax Rules, 1994. In the present case the service involved is telecom service, this service is chargeable to service tax only when service is provided by a person who has been granted a Licence under first proviso to section 4(1) of the Indian Telegraph Act, 1885. In the present case admittedly the appellant do not possess the Licence under first proviso to section 4(1) of the Indian Telegraph Act, 1885. Therefore, even though the service is a telecom service but not as per the statutory definition of the telecom service hence the same is not taxable. This has bee....
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....tuation in the instant case since the service provider is located abroad, he is not covered under the definition given in Section 65(109a). Thus the service provided by foreign vendors cannot be taxed under Telecommunication service. 3. Section 65(105)(zzzq) read with Section 65(104c) of the Finance Act, 1994, defines Business Support Service as services provided in relation to business or commerce and includes evaluation of prospective customers, telemarketing, processing of purchase orders and fulfilment services, information and tracking of delivery schedules, managing distribution and logistics, customer relationship management services, accounting and processing of transactions, operational assistance for marketing, formulatio....