TaxTMI 
TaxTMI 
2025 (11) TMI 198
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.... and providing various taxable services. Appellant had entered into a Master Laboratory Service Agreement with foreign companies for conducting clinical trial / research as per specification ordered by the appellant. During audit it is observed that the appellant is receiving the services of clinical trial from overseas and making payment in foreign currency. Alleged that it is classifiable under category of "Technical Testing and Analysis Services" as defined under Section 65(105)(zzh) read with Section 65 (106) and Section 65(107) of the Finance Act, 1994, demand was made for the period from May 2006 to March 2011. Adjudication Authority as per the impugned order confirmed the demand and also imposed penalty under various provisions of law. Aggrieved by said orders, present appeals are filed. Appeal No. ST/26380/ 2013 pertains to the period from May 2006 to September 2010 and Appeal No. ST/28271/2013 pertains to the period from October 2010 to March 2011. 3. When the appeals came up for hearing, Learned Counsel submits that Section 65(106) specifically defines Technical testing and analysis and Section 65(107) defines Technical testing and analysis agency. The definition of Te....
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.... not cover under Section 65(105)(zzh) of the Finance Act, 1994. They were fastening the demand with a finding that delivery of report amount to part of service. Such finding is without authority of law and unsustainable. TTA service can be invoked is only if partially performed in India. In Appellant's case, entire activities of testing and analysis of the samples have been admittedly being performed outside India. Even if delivery of the report amount to part of service, performance of TTA Service is clearly and only outside India as determined by definition under Section 65(105)(zzh) of the Finance Act, 1994. Thus, there is no rule for intendment in taxing statute. Learned Counsel draw our attention to the earlier decisions including the decision in the matter of M/s. Total Oil India Ltd. Vs. Commissioner of Service Tax, Mumbai - II - 2017 (5) GSTL 209 (Tri. - Mumbai), Commissioner of Service Tax, Ahmedabad Vs. B.A. Research India Ltd. - 2010 (18) STR 439 (Tri. - Ahmd.). 6. As regarding the demand confirmed by invoking the extended period of limitation and penalty, learned counsel submits that there is no reason of justification to invoke the extended period of limitation and ....
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....be treated as performed outside India; (2) The provision of any taxable service (specified in Sub-rule (1)] shall be treated as export of service when the following conditions are satisfied, namely:- (a) such service is delivered outside [provided from India and used outside India, and (b) payment for such service (provided outside India] is received by the service provider in convertible foreign exchange. *[added or substituted w.e.f. 01.03.2007] #(deleted w.e.f. 01.06.2007) 8. Reading of the above provisions of Export of Services Rules, 2005 (hereinafter referred to as "the Rules") makes it amply clear that the taxable service specified in Sub-clause (zzh) of Clause (105) of Section 65 of the Act is covered under Rule 3(1)(ii) of the Rules. The performance is not complete until the testing and analysis report is delivered to the client. In the present case, when such reports were delivered to the clients outside India, it amounts to taxable service partly performed outside India. The performance of the taxable service has no validity/sanctity unless its report is submitted to the service receiver/client. The clients do not have any val....
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....The department confirmed a demand against the company contending that it had not paid service tax on amounts received against the export service. * BA Research appealed before the Commissioner (Appeals), who set aside the demand by allowing benefit of exemption of service tax under Notification 11/2007-ST dated March 1, 2007. Aggrieved by the Order of the Commissioner (Appeals), the department appealed before the Tribunal. * While upholding the view of BA Research, the Tribunal in the case held that the performance of the service is not complete until the testing and analysis report is delivered to its clients who are situated outside India and such delivery of report amounts to provision of services partly outside India. Further, the Tribunal also stated that services provided has no validity/ sanctity unless the report is submitted to clients and the clients do not get any value from mere performance of services. 9. Learned Counsel further submits after the amendment of the provision in case of TTA Services, while the essence of the service is to carry on a testing activity, the result is always communicated by way of a report. The report is mere communicatio....