AI Drafter 
TaxTMI 
TaxTMI 
2024 (12) TMI 1029
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....r referred as UTS-USA) dated 1 April 2002, initially for three years i.e. upto 31 March 2005 which was further extended up to 31 March 2008, to provide all marketing and supports service requested for by UTSUSA. From the various clauses of the said agreement the department observed that UTS-India agreed to provide, at its own expense and to the reasonable satisfaction of UTS-USA, such officers and other premises administration, facilities, marketing, organization and trained staffs as may be necessary for the efficient and effective performance as exclusive service provider to UTSUSA. Vide the another clause UTS-India agreed to comply all Indian statutes, laws, Regulations and Rules or any other applicable Statutes at all times and shall pay, when due and payable, all taxes, duties, levies and fees including corporate tax, income tax, service tax etc as may be levied on UTS-India by any government or authority on services rendered by UTS-India to UTS-USA. 1.2 The department observed during the test checks of final accounts of UTS-India for the year 2008-09 that the company has raised invoices for various services provided in the project for HYE for an amount of Rs.56,64,89,097/-....
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....eration in US dollars. The said amount of consideration was inclusive of all taxes except the withholding tax. The telecommunication companies in India were also paying service tax on the services provided by UTS-USA considering the services as 'Import of the Service'. 3.1 Learned Counsel further mentioned that the appellant was acting on behalf of UTS-USA, being their branch office in India. The appellant, though was not legally required, but disclosed the value of transaction between UTS USA and the Indian Telecom Company in its ST-3 return filed for December 2006, January 2007 and February 2007. The appellants have also informed the Jurisdictional Assistant Commissioner, Service Tax vide letter dated 20 June 2007, duly received by the department on 27 June 2007 ,that the customer of UTS-USA (Reliance Infocom) has treated the services rendered by the UTS-USA as 'Import the Service' in terms of section 66A of the Finance Act, 1994 read with Taxation of Services (provided from outside India and received in India) Rules 2006. The service tax component of the invoices raised upon Reliance Infocom has been deposited by Reliance Infocom under Reverse Charge Mechanism. 3.2 Learned....
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....27,64,350/- has not be paid by the appellants despite that the said amount has also been reflecting in ST-3 returns filed by the appellants for the period October 2006 to March 2007. Hence there is no infirmity in the findings of the order under challenge. Finally retreating the finding therein specifically, in para 19.2 to 19.5 of the impunged order the order under challenged is prayed to be upheld and the appeal is prayed to be dismissed. 5. Having heard both the parties at length and perusing the entire record of the present appeal, we observe that partial demand w.r.t to services provided by the appellants to BSNL, since service tax was already paid by the appellants, stands already dropped and the department admittedly is not in appeal. Hence the moot issue to be adjudicated is: "Whether the services in question have been provided by UTS-USA directly to Reliance Infocom amounting to 'Import of the Services' or the services are provided by the appellant inviting its liability to pay service tax?" 6. Foremost we need to know as to what constitute "service". Section 65 b (44) of the Finance Act 1994 defines service to mean:- "Service" means; •....
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....ntenance Contract dated 25.02.2003. The perusal reveals that: • UTS-USA, Alameda, California, USA has agreed, as contractor, including its legal successor, to provide Support Services as explained in clause 2 of the said agreement to Reliance Infocom Ltd. District Jamnagar, Gujarat, India. • The contractor / UTS-USA shall had to raise the invoice in accordance with the billing methodology described in scheduled A of the said agreement alongwith the supporting document quoting the prices based upon the scope of the services and the said prices are agreed by the Reliance. • Clause 3 (b) of the agreement discussed about the payment mentioning that the Reliance Infocom shall pay contractor duly invoice service fee in accordance of the agreed payment terms. Sub clause (iii) and (iv) of clause 3 reads as follows: - (iii) All prices for Support Services shall be exclusive of all taxes in India except withholding tax. It is agreed between RELIANCE and CONTRACTOR that, as on the Effective Date of this Contract, service tax is not applicable and RELIANCE represents that it shall pay such tax when such tax becomes applicable as per Applicable La....
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....SA and UTS-India is wrongly alleged as the servicer provider to Reliance Infocom Pvt. 11. Coming to the core issue, we observe that Rule 3 of Place of Provision Rules, 2012. Rule 3:- Place of provision Generally the place of provisioning of services is the location of service recipient. 11.1 In terms of Notification No.30/2012 dated 20.06.2012, the taxable services provided or agreed to be provided by any person who is located in a non-taxable territory and received by any person located in the taxable territory [other than non-assessee online recipient], 100% tax shall be paid by the recipient of the service. Further, any service provided from outside India and received in India is Import of Service. The service recipient is liable to pay service tax on import of services. 11.2 Recipient in the present case is Reliance Infocom located in taxable territory. Resultantly it was Reliance Infocom who was liable to pay service tax under reverse charge mechanism on the amount in dispute paid during the disputed period to UTS-USA. It is also the admitted fact on record that the Reliance Infocom has discharged the entire service tax liability on the disputed amou....