TaxTMI 
TaxTMI 
2025 (3) TMI 1451
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.... passed by Commissioner (Appeals), Madurai upholding the Order-in-Original No. 02/2015 dated 24.02.2015 confirming the demand of Service Tax and also imposing penalties under relevant provisions of the Finance Act, 1994 (ACT). 2. Facts briefly stated are that the Appellant was discharging service tax on reverse charge basis in respect of services rendered by M/s. Project Management Inc, USA for the goods manufactured and exported by them for the period upto June 2008. However, they ceased to pay service tax from July 2008 in terms of Rule 3 of Taxation of Services (Provided from Outside India and Received in India) Rules, 2006 which excluded service tax liability on the transactions carried out wholly outside India. It appeared to the de....
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....based on Rule 3(ii) of the 2006 Rules for asserting its immunity to tax on the ground that the service was performed by an overseas company and is thus beyond the reach of the Indian service tax net. 3.3 The Ld. Counsel submitted that the issue was no more res integra as the Tribunal had on the same issue for earlier periods in respect of the Appellant vide Final Orders No. 43100/2018 dated 10.12.2018 and No. 40428/2023 dated 13.06.2023 decided the matter in favor of the Appellants by setting aside the impugned orders. 4. The Ld. Authorized Representative Mr. N. Satyanarayanan representing the Department affirmed the findings in the impugned order and submitted that the Appellant is liable to pay service tax under reverse charge mecha....
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....Agency service'. It is not disputed that the services were provided as well as consumed outside India. Section 66A reads as under:- "66A. (1) Where any service specified in clause (105) of section 65 is,- a) provided or to be provided by a person who has established a business or has a fixed establishment from which the service is provided or to be provided or has his permanent address or usual place of residence, in a country other than India, and b) received by a person (hereinafter referred to as the recipient) who has his place of business, fixed establishment, permanent address or usual place of residence, in India, such service shall, for the purposes of this section, be the taxable service, and such taxable....
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....ule 3. It is clear that these category of services specified under sub-rule (ii) shall be totally excluded when the services are wholly provided / performed outside India. The adjudicating authority has held that the said Rule would not be applicable to the appellant on the ground that the same would be applicable only when part of the services are performed in India. On reading of the Rule, it is clear that if the services which are mentioned therein are performed outside India, there is no liability to pay service tax. 7. The very same issue was considered by the Tribunal in the appellant's own case as reported in 2018 (11) TMI 1151 CESTAT, Chennai and observed as under:- "5. From the facts narrated above, it is seen tha....
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....tue of Rule 3(ii) of the Rules. The relevant portion of the judgement is extracted below for the sake of convenience: "5. We find that the Ld. Advocate is correct in his assertion that since services have been wholly performed outside India, the activity will not be exigible to service tax by virtue of Rule 3 (ii) of the Taxation of Services (Provided from Outside India and Received in India) Rules, 2006. We find that the case laws relied upon fully support his assertion. Following the ratio already laid down, we find that the impugned order cannot sustain and will have to be 5 set aside, which we hereby do. Appeal is allowed with consequential relief, if any, as per law." (Emphasis supplied) 9. The learned AR has....