TaxTMI 
TaxTMI 
2026 (10) TMI 393
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....4.2015 02.11.2016 ST/51646/2018 October 2014 - March 2016 12,73,16,427 Not quantified Section 76 07.03.2017 31.01.2018 ST/52763/2019 April 2016 - June 2017 9,06,56,452 Not quantified Section 76 and Section 77 16.04.2019 31.07.2019 2. The first appeal covers both the pre-negative list regime, i.e., from October 2009 to 31.06.2012 and also the post negative list regime, i.e., from 01.07.2012 to September 2014. The second and the third appeals pertain entirely to the post negative list regime. 3. We have heard both learned counsel for the appellant and learned authorised representative for the department and perused the records. The appellant is a public sector company and a joint venture of the Madhya Pradesh State Electronic Department Corporation (MPSCDC) and Tata Consultancy Services (TCS) formed to develop, maintain and manage Madhya Pradesh Government's e-governance portal www.mponline.gov.in to facilitate providing web based services by the State Government to its citizens. It was established through a Government Order of the State Government which seeks e-governance of all government services to citizens by creating and IT inf....
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....pellant had established a network of kiosks so as to reach the citizens at their doorsteps as required by the MP government. For appointing the kiosks, the appellant entered into a tri-partite agreement with the kiosk owners and the MP government. The kiosk operators were youth having limited education but who could operate computer systems. The appellant collected an initial registration fee from the kiosk operators and also annual franchise fee. It also received security deposit from the kiosk operator which enabled the kiosk operator to collect government charges, education fee, utility bills etc. to the extent of the security deposit. e) Interest on FDs: The appellant is required to pay to the government departments, educational institutions, utility company etc. the amount collected on the same day or the next day of collection or in some cases within five days. This delay resulted in the appellant having surplus funds which it had deposited in fixed deposits earned interest. 4. The demand of service tax for the pre negative list period (before 01.07.2012) is on the ground that the appellant had provided services under Online Information and Database Access or Retr....
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....returns. h) On franchise fee also the appellant paid service tax and reported the same in its returns. i) Interest on FDs, being in the negative list under section 66D(n)(i) of the Finance Act was exempted and no service tax was paid for the reason. j) The first show cause notice issued invoking extended period of limitation, the demand was made under the heads OIDAR, data digitisation and interest on fixed deposits. Issue Period Demand ST Paid OIDAR October 2009 September 2014 - 18,27,22,690 4,79,66,722 Exempt from 01.07.2012 (Non-Taxable till 30.06.2012) Data Digitization October 2009 March 2011 - 6,79,158 Nil (Non-taxable) Interest on fixed deposit October 2009 September 2014 - 2,19,71,468 Nil (Non-taxable) Total 20,53,73,316 4,79,66,722 k) For the second show cause notice the demands were made as follows: Issue Period Demand ST Paid Portal income provided to educational institution October 2014 March - 2016 7,07,87,638 Nil (Exempted) Portal income provided to private companies and Government Departments October 2014 March -2016 ....
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....de and appeals may be allowed. 7. Learned authorised representative for the Revenue vehemently supported the impugned order and asserted that the appellant had provided OIDAR services and data digitisation services before 01.07.2012 and, therefore, service tax was payable. After 01.07.2012 these services are chargeable to service tax as they were not in the negative list. He also asserted that extended period of limitation was correctly invoked as the appellant had failed to disclose the correct classification and pay service tax in its ST-3 returns and the department discovered the suppression only during audit. He further asserted that under self-assessment, the assessee is required to make a true and complete disclosure and the appellant had not. He prayed the impugned order be upheld and the appeals may be dismissed. 8. We have considered the submissions advanced by both sides and perused the records. The well settled legal principle is that OIDAR services can be alleged to have been provided only if the data belongs to the service provider. The service provider cannot provide access to data which itself do not possess. In this case, the appellant had provided only a netw....