TaxTMI 
TaxTMI 
2024 (8) TMI 1337
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....ed in provision of 'Management Consultancy Services' and accordingly has entered into an agreement with M/s Price Water House Coopers at USA, UK and Australia (hereinafter referred to as 'PwC Overseas') for provision of Management Consultancy Services during the period of 31.08.2006 to 31.03.2011. 2.2 During September 2006, the Audit Officials from the Service Tax Department conducted an audit of the service tax records of the appellant. Subsequently, the Department issued various letters to the appellant to ask for details for the period 23.05.2006 to 31.03.2011, which was duly furnished by the appellant. The appellant also informed the Department vide letter dated 14.11.2006 that they have taken registration under the head Management Consultancy Services and therefore, are eligible to exemption under Rule 3(3) of the Export of Service Rules, 2005. On the basis of audit of records conducted by the Department, a show cause notice dated 20.04.2012 was issued to the appellant alleging that: • firstly, the appellant had rendered services in the nature of Market Research and Financial Auditing and has not paid the service tax on such services by claiming exe....
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....ilar to services rendered by the Chartered Accountant Firm. In this regard, he submits that the services which are rendered by a Chartered Accountant Firm are as under: 1) Conducting Statutory Audit of books of accounts under Section 224 of Companies Act, 1956 2) Conducting Tax Audits under Section 44AB of Income Tax Act, 1961 3) Conducting Internal Audit of books of accounts under Companies Act, 1956 4) Statutory Certification under Income Tax Act, 1961 5) Maintenance of books of accounts (book-keeping) as per Section 209 of Companies Act, 1956 He also submits that the services rendered by the CA Firm are governed by statutory provisions of Companies Act, 1956 and Income Tax Act, 1961. On the contrary, the services rendered by the appellant are by no stretch of imagination covered under any of the services rendered by a CA Firm. He further submits that the services which are rendered by appellant are as under: a) Providing consultancy or advice, b) Assistance in mergers & acquisition of companies, c) Conducting due diligence under specific situations/transactions, d) Conducting health check or diag....
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.... cannot be classified under two categories of taxable services. In this regard, he refers to Section 65A of the Finance Act and submits that submits that the service can be categorized only under one head which is more specific and which justifies the nature of transaction more closely and keeping that criteria in mind, the services rendered by the appellant are closely taxable under the category of 'Management Consultants Services' because the entire range of services cannot be classified either under CA Services or Market Research Services. 4.6 As regards the services rendered by the appellant which qualify as export of services within the meaning of Export of Service Rules, the learned Consultant submits that as per Export of Service Rules, the following conditions are provided for a service in order to constitute as export: From 31-08-2006 to 28-02-2007 Taxable services which were provided and used by the recipient in or in relation to commerce or industry, such services would be treated as export of services only if a) The recipient of such services was located outside India, b) In case recipient of service has an office/establishment in ....
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....¢ Gap International Sourcing (India) Pvt Ltd - 2014-TIOL-465-CESTAT-DEL • M/s Paul Merchants Itd. Vs. CCE, Chandigarh - 2013 (29) STR 257 (Tri. Delhi) 4.7 The learned Consultant further submits that the demand has been erroneously computed as the appellant has not been given the benefit of cum-tax demand. He further submits that the Department has confirmed the service tax demand of Rs.1,27,90,193/- under the category of CA Services and Market Research Services, but the Department has not segregated the amount of demand pertaining to CA Services and Market Research Services separately. 4.8 As regards, payment of interest, the learned Consultant submits that when the service tax itself is not leviable, therefore, the question of interest does not arise. 4.9 The learned Consultant further submits that the adjudication proceedings in the present case had become barred by limitation in view of Section 73(4B) of the Finance Act, 1994 which inter alia provides that the Central Excise Officer shall determine the amount of duty within six months in case notice has been issued under Section 73(1) and within one year in case of fraud, collusion etc. Whereas, in the p....
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....re Holding Vs CCE - 2007 (216) ELT 177 (SC) 4.11 As regards penalty under Section 78 of the Finance Act, 1994, the learned Consultant submits that the said penalty cannot be imposed because the appellant entertained a bona fide belief that services provided by them are appropriately classified and covered under export of service during the impugned period. 5.1 On the other hand, the learned AR for the Revenue reiterated the findings of the impugned order and filed the written submissions. The learned AR submits that the services rendered by the appellant are financial auditing which are classifiable under the category of CA Services as per the provisions of Section 65 of the Finance Act, 1994. 5.2 The learned AR further submits that as per Rule 3(2) of Export of Service Rules, 2005, as amended vide Notification No. 6/2010-ST dated 27.02.2010 sub-clause 2(a), such services provided from India and used outside India had been omitted vide Notification No. 6/2010-ST dated 27.02.2010. He further submits that both the services namely 'Market Research Agency's Services' and 'CA Services' fell under Rule 3(2) of the Export of Service Rules, 2005 and in order to be eligible for exe....
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.... ii. offers to perform or performs services involving the auditing or verification of financial transactions, books, accounts, or records or the preparation, verification or certification of financial accounting and related statements or holds himself out to the public as an accountant; or iii. renders professional services or assistance in or about matters of principle or detail relating to accounting procedure or the recording, presentation or certification of financial facts or data; or iv. renders such other services as, in the opinion of the Council, are or may be rendered by a chartered accountant in practice; and the words "to be in practice" with their grammatical variations and cognate expressions shall be construed accordingly. 8. Further, we find that in para 11 of the impugned order, the learned Adjudicating Authority has relied upon Section 2(2) of the Chartered Accountants Act, 1949 to conclude that the services of auditing of financial transactions, books of accounts or records etc is covered under the ambit of a practicing chartered accountant. 9. Further, we find that the appellant, which is a Private Limited Company i.e. an Incorporated C....
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.... as agreed with PwC Overseas Network Firms. The privity of contract arises between the appellant and PwC Overseas Network Firms and not between the appellant and the clients of PwC Overseas Network Firms, because the PwC Overseas Network Firms have separate agreement with its clients. 13. Further, we are of the opinion that the issue whether the services provided by the appellant to the Foreign Network Firms and other Foreign Companies for a consideration collected in convertible foreign exchange would be qualified for export services under Export of Services Rules, 2005 or otherwise is no more res integra and has been settled by the Hyderabad Bench of the Tribunal in the appellant's own case vide Order No. A/31339-31340/2018 dated 25.10.2018 reported as CCE & ST, Hyderabad-II Vs Price Water House (vice versa) - 2018 (11) TMI 32. The extract of relevant part of the said order is reproduced below: "It is undisputed that the appellant herein rendered services to their overseas network entities as well as to their clients located outside India and the consideration for such services was collected inconvertible foreign currency. The findings of the adjudicating authority is....
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....ad, it has to be treated as export of service. 14. Further, we find that in this case the show cause notice was issued on 20.04.2012 and the reply was filed by the appellant on 10.07.2012, but the impugned order was passed on 29.11.2019 i.e. after seven years of issuance of show cause notice. It has been consistently held by the Tribunals/Courts that the Adjudicating Authority is required to pass the order within time as prescribed under Section 73(4B) of the Finance Act, 1994; but in the present case, the same was not passed within time. Therefore, in view of the ratios of the decision of Hon'ble Delhi High Court in the case of Sunder System Pvt Ltd (supra) and the decision of Hon'ble Jharkhand High Court in the case of M/s Kamaladitya Construction P Ltd (supra), the show cause notice needs to be quashed. 15. As regards limitation, we find that the dispute in this case involves interpretation of classification of service and eligibility for export of service and it has been held by the Hon'ble Apex Court in the case of Padmini Products Vs Collector of C.Ex. (supra) that when the matter involves interpretation of statutory provisions, extended period of limitation cannot be i....