Custom, Excise & Service Tax Tribunal
Jet Airways (I) Ltd vs Commissioner Of Service Tax on 5 April, 2016
IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL, WEST ZONAL BENCH AT MUMBAI COURT No. I Appeal No. ST/87494 to 87498/13 (Arising out of Order-in-Original No. 60-64/STC-1/SKS/12-13 dated 14.03.2013 passed by Commissioner of Service Tax, Mumbai) For approval and signature: Honble Mr. M.V. Ravindran, Member (Judicial) Honble Mr. C.J. Mathew, Member (Technical) ================================================
1. Whether Press Reporters may be allowed to see : No the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?
2. Whether it should be released under Rule 27 of the : No CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
3. Whether Their Lordships wish to see the fair copy : Seen of the Order?
4. Whether Order is to be circulated to the Departmental : Yes authorities?
Jet Airways (I) Ltd.
Appellant Vs. Commissioner of Service Tax Mumbai Respondent Appearance:
Shri Rafiq Dada, Sr. Advocate Shri Rohan Shah, Advocate Shri J.H. Motwani, Advocate Ms. Divya Jaswant, Advocate Ms. Sanchita Rungta, Advocate for appellant Shri Roopam Kapoor, Commr (AR) for respondent CORAM:
Honble Mr. M.V. Ravindran, Member (Judicial) Honble Mr. C.J. Mathew, Member (Technical) Date of Hearing: 05.04.2016 Date of Decision: ..2016 ORDER NO Per: M.V. Ravindran These appeals are directed against order-in-original No. 60-64/STC-1/SKS/12-13 dated 14.03.2013.
2. Since all the three appeals raise a common issue and in respect of the very same assessee, they are being disposed of by a common order.
3. This matter was heard at length for three days i.e. 16th March, 28th March and 5th April of 2016. The issue in brief is that appellant herein is engaged in running an airlines having operations all over India as well as outside India. Based on intelligence that the appellant is evading service tax on the services availed under the category of online information and database access or retrieval service (herein after referred to as services) from foreign based service providers and is not depositing the tax liability on the amounts paid to such foreign based service providers. Investigation was initiated, statements were recorded and copies of the agreements were called for and scrutinized. On scrutiny it was noticed that appellant entered into agreements with entities like M/s. Abacus Distribution System Pvt. Ltd., M/s.Galileo International Partnership, M/s. Amadeus Marketing S.A., M/s Sabre Travel Information Network, M/s. Infini, M/s. Topaz, Axess, Apollo, M/s. Travelsky who were the Companies provided Computer Reservation System (CRS) based upon a facility called as Global Distribution System (GDS). Advantages of CRS Company is that they are able to display the real time availability of flights, reservation availability and all the details related to the movement of flights. The CRS Companies are located outside India and collect the data i.e. real time data from the main server of the Jet Airways, the appellant herein. It was noticed by the investigating authorities that functioning of the system is when the Travel Agent logs in through CRS server for making a booking, the CRS server first connects up with the main server of the appellant to confirm the availability of the tickets which is done on a real-time basis. On receiving the information the travel agent as and when, he confirms the ticket, the inventory position is updated directly in the main server (Sabre Server); server of the CRS transmits the passenger details for every booking done after updating the server on a real-time basis and the ticket for each passenger is generated and issued. As per the agreements entered by the appellant with CRS Companies, the appellant is required to pay an amount for each ticket issued by any travel agent. Coming to a conclusion that the appellant herein having paid these CRS Companies an amount towards the issue of tickets of the passengers embarking from India, show-cause notice was issued demanding differential tax, interest thereof and also seeking to impose penalties and that the services would merit classification under the Services. Invoking the provisions of Section 66A of the Finance Act, 1994 the show-cause notice demanded the tax from the appellant as recipient of the services from the Company based abroad. Appellant contested the show-cause notice on merits as well as on limitation ( in one show-cause notice extended period of limitation is invoked). It was the case of the appellant before lower authorities that provisions of Section 66A will not apply in this case and the services cannot be categorized as falling under online information and database access or retrieval service. The adjudicating authority after following due process of law, did not agree with the contentions raised by the appellant and confirmed the demands raised along with interest and imposed penalties. The adjudicating authority however, dropped the demands raised for the period 01.04.2003 to 17.04.2006 on the ground that the provisions of Section 66A for demanding service tax under reverse charge mechanism was introduced in statute from 18.04.2006 only.
3. Shri Rafiq Dada, Sr. Advocate with Shri Rohan Shah, Shri J.H. Motwani, Advocate, Ms. Divya Jaswant, Advocate and Ms. Sanjita Rungta, Advocate appeared on behalf of the appellant and Shri Roopam Kapoor, Commissioner (A.R.) appeared for the Revenue.
4. Learned Sr. Advocate after explaining us the overall functioning of booking of tickets, reads the definitions of the services and taxable services as assigned in Section 65 (75) and Section 65 (105)(zh) for the meaning taxable services. He would submit that for classification under taxing entry of the services there are four requirements -
(i) providing data or information,
(ii) retrieval or otherwise,
(iii) to any person and
(iv) in electronic form through a computer network, 4.1 It is his submission that the data or information, which is provided must either be owned by the service provider or at the very least must not be owned by service recipient himself. It is his submission that CRS Companies make data available to the Travel Agents and act as medium of exchange of data / information as a part of the chain through which data is exchanged and they do not provide any data as they do not own the same. He would submit that the adjudicating authority has himself noted that the data as inventory availability etc. is owned by the appellant. He would submit that it is settled law that the ownership of the data is a key criterion under the present taxing entry as has been decided by the Tribunal in the case of United Telecom v. CST Bangalore 2009 (914) STR 212 and State Bank of India v. CCE Chennai 2015 (37) STR 340. It is his further submission that in the issue of applicability of reverse charge mechanism is to be considered in the case in hand. He would submit that the CRS Companies are situated abroad and issued tickets to the passengers who book the same through Travel Agent. He would submit the service recipient in this case is not the appellant as is very clear from the facts that the data of availability of seats and flights is of the appellant himself. It is his further submission that the phrase in relation to for the taxable service of the Services cannot take precedence over the requirements of the taxing entry itself and must be circumscribed by them. It is his further submission that in the case in hand the expression in relation to in taxing entry cannot be construed so wide enough to bring within the ambit of the taxable service any activity connected with the access/retrieval of online information, when the said taxing entry explicitly requires the provision of data / information and if the entry is interpreted so widely, it would cover activities such as maintenance of servers, upgrading of interface software, provision of manpower for operation of the interface etc., when in fact these activities were only brought to tax under other taxable entries at a subsequent point of time without any simultaneous amendment to the present entry. It is his further submission that in any event, any provision of data, if at all, is incidental to the main activity of ticket booking and cannot form the basis of classification. It is his further submission that the activities of CRS Companies in providing a technology platform in respect of the data of the airlines and enabling the Travel Agents to make reservations and purchase tickets effectively facilities and culminates in an overall e-commerce transaction, which is not liable to service tax. For the proposition that e-commerce transaction are not liable to service tax, he relies upon the judgement of the Apex Court in the case of All India Federation of Tax Practioners vs. UOI 2007 (7) STR 625 (SC) and Circular No. MOF. F.No. B-11/1/2001-TRU dated 9th July 2001. It is his further submission that the person liable to pay tax are the CRS Companies as they have offices in India through which they are conduct the business and these can be construed as permanent establishments as CRS Companies. He would submit that the term permanent establishment is not defined under Service Tax law hence it is permissible to refer to a pari material legislation, viz. the Income Tax Act, under which the CRS Company offices in India have been held to be permanent establishment. Accordingly, CRS Company should be liable to discharge the service tax if any. He would submit that levy of service tax under Section 66A on the present transaction where data / information is displayed on the CRS servers which are located outside India and the services are therefore not provided / rendered within India would be unconstitutional hence tax liability would not arise. It is his submission that the CRS companies are providing necessary access to software and on-line connectivity to the subscriber but in this case is Travel Agent who obtain information, make reservations and issue documents as to the travel related services. It is his submission that the amounts paid by the appellant is for the use of CRS system of the CRS Companies and is in no manner correlated to the fact of provision of data / information to the Travel Agents. He would also submit that the entire demand of the tax is Revenue neutral as even if the appellant pays the service tax it can be availed as credit as these services are utilized for rendering output services which are taxable. He would submit that the limitation and aspect apply to atleast one show-cause notice wherein the show-cause notice is dated 23.10.2008 issued for the period 01.07.2003 to 31.03.2008 and in one show-cause notice which is dated 21.10.2011 for the period 01.04.2010 to 31.03.2011 is time barred as this show-cause notice was issued for taxing entry under Business Support Services; subsequently corrigendum dated 19.03.2012 was issued for the same period seeking to order the classification to the current classification of the services. It is his further submission that in a revenue neutral situation, larger period of limitation cannot be invoked and no penalty or interest is payable. He would then bring to our notice of the salient findings of the order-in-original.
4.3 It is his further submission that the service recipient is the person who receives services rendered by the service provider which in this case, the appellant is not service recipient as no services are provided to by the appellant to the CRS Companies; Travel Agent has an independent contract with the CRS Company to access data while the impugned order holds that the benefit of services goes to the appellant which is very week and there is no specification of the service receiver and the person who receives the benefit cannot be said to be service recipient. He would submit in the absence of service provider, service recipient relationship between he appellant and the CRS Companies, service tax liability cannot be critical qua the appellant need reverse charge mechanism. He would further submit that there must be an access between the payment which is sought to be service tax and the taxable which is alleged to have been received. He would submit that in the facts of this case there is no payment for access and retrieval of the data of the Travel Agent and the Travel Agent is at liberty to as many accesses as he desires and also make retrieval for which there is no charge. It is his submission that the charge is payment only when the ticket is booked and such payment is purely for booking ticket, cannot be subjected to service tax under the entry of taxable services.
5. Learned Commissioner would submit that there is no dispute that the appellant has entered into contract with CRS Companies for enabling them to allow to accesses of the data of Jet airways seat availability, flight schedule for rendering services of on-line information and data base services. It is his further submission that the Travel Agent accesses the data through CRS Company and book the ticket which are of the appellants airline. He would then draw our attention to the fact that the Travel Agents are making the payments of the tickets so booked after deducting their commission, to appellant. He would then draw our attention to the specific clauses of the agreement and submit that appellant had entered into an agreement with CRS Companies for making payment of specific amount on tickets issued to travelers in India. He would submit that the activities of CRU Companies maintaining on-line information as to availability of flight schedule, fare, seat etc. operated by the appellant all over the world. He would submit that the contract of appellant with CRS Companies clearly indicate that while Jet airways is required to provide data, CRS Company would be providing information regarding fare, seat availability etc and the relevant paragraphs of the contract was read through and indicated that the information so provided is being used by the CRS Companies for transmitting the same to the travel agents. He would submit that this is nothing but a information which is being disseminated to various travel agents for booking a ticket for the passenger. On Revenue neutrality it is his submission that appellant is not only providing taxable services but also exempted services. Hence provisions of CENVAT Credit Rules needs to be gone into before holding that as the appellant is eligible for CENVAT credit of the tax paid under the category of on-line distribution services, as there is a limitation for the availment of CENVAT credit if an assessee provides exempted as well as taxable services. As an example he would submit that the appellant is not discharging service tax on the transport of passengers by economy class within India while the service tax on transporting of a particular passenger whenever they travel abroad. He would submit that the definition of exempted services needs to be gone into but there was no challenge to legality of the framed rules regarding taxation and the service tax which means the services on which service tax is leviable under Section 66 of the Finance Act, 1994; the adjudicating authority has correctly come to the conclusion that part of the services by the appellant is an exempted services. He would submit that the adjudicating authority was correct in holding against the appellant as the majority decision of this Tribunal in the case of British Airways 2014-TIOL-979-CESTAT-DEL and in the case of Qatar Airways 2014-TIOL-1767-CESTAT-Mum has held that the services provided by the CRS Companies are covered within the scope of on-line information and data base access or retrieval service. As regards the demand by invoking extended period he would submit that the extended period has been correctly invoked as the appellant has not filed any return or gave any information regarding the payment of an amount to CRS Companies.
6. In rejoinder, learned Sr. Advocate submits that the reliance placed by the learned Commissioner (A.R.) on the decision of British Airways (supra), Qatar Airways (supra) and Thai Airways International Public Co. Ltd. 2014-TIOL-1574-CESTAT-Del is incorrect as the said activity and scope of the taxing entry for on-line Information and Database Access or Retrieval Service it is to be noted that it is inherent to the concept of access/retrieval for which the consideration is paid, the person who renders that services should be owner or should have exclusive right over the relevant information/data so as to put him in a position to charge the recipient for access/retrieval of that data/information. He would submit that the adjudicating authority is faulted and did not consider the fact that the appellant is clearly being invoiced on the basis of charging event i.e. the booking of a ticket and not for any access of data or information. He would submit that the judgement of this Tribunal in the case of United Telecom (supra) and State Bank of India (supra) were directly on the issue. He would submit that the demands to be set aside and the appeals be allowed.
7. Heard both sides at length on 16.03.2016, 28.03.16 and 05.04.16.
8. The issue that falls for consideration is whether the services rendered by the CRS companies to the appellant are classifiable under the taxing entry of online information and database access or retrieval service or otherwise; appellant is correct in claiming the revenue neutrality situation or otherwise.
9. Undisputed facts are that appellant is a Company registered in India and undertaking its activity in India. As per the standard procedures on the international as well as domestic airline ticketing, appellant had entered into an agreement with various companies like M/s Abacus, M/s. Galileo International , M/s Amadeus, M/s Infini etc., to avail the facility of Computer Reservation System (CRS) as provided by these Companies and as per the agreement they are required to pay these Companies an specific amount on each and every ticket booked. The CRS Companies are situated abroad and amounts paid to them by appellant are considered by the Revenue as chargeable to service tax under reverse charge mechanism as per the provisions of Section 66A of the Finance Act, 1994.
9.1 The main issue that was argued at length by both sides is that the activities of the CRS Companies as provided to the appellant is not classifiable under taxing entry of online information and database access or retrieval service. Much was argued by both sides after taking us through the relevant entries and also various case laws. We find from the argument put forth by the learned Sr. Counsel for the appellant that the said activities of CRS Companies would not fall under the category of online information database access or retrievable services seems to be incorrect on merits, as an identical issue is decided by three judgements of this Tribunal by majority order.
9.2 We find that in the case of British Airways - 2014-TIOL-979-CESTAT-Del which was decided on 23.05.2014, the issue was regarding the service tax liability on the same services provided by CRS Companies to British Airways. There was a difference of opinion between the Members who heard the matter initially. Learned Member (Technical) in his findings in Para 29 recorded as under:-
29. Coming first to the question of classification of the service, the activity of the CRS/GDS Companies is maintaining online information on real time basis about the flight schedules, fare, seat availability etc. of the flights being operated by BA,U.K. all over the world, for which CRS/GDS Companies have linkage with the computer system of BA, U.K. and provider access in respect of this information to the IATA agents appointed by British Airways which is used by them for selling of air tickets of British Airways. I agree with the findings of my learned brother that this activity of the CRS/GDS Companies is covered by the definition of "Online Database access and/or retrieval" service, as given in Section 65(75) read with Section 65(36) of the Finance Act, 1994 and this service, if provided or deemed to be provided in India, would attract service tax under section 65(105)(zh) ibid. In this regard, I do not accept the Appellant's contention that the activity of CRS/GDS Companies is e-commerce and therefore, not taxable, as there is no sale of tickets by the CRS/GDS Companies. The Tickets of British Airways are sold through IATA agents by using the information/database maintained by the CRS/GDS Companies and it is the IATA agents who collect payments from the passengers. Another plea of the Appellant that for taxing a service under section 65(105)(zh) read with section 65(75), as "Online Database access and/or retrieval service", the data stored in computer system to which access is provided, must belong to the service provider and since in this case, the data belongs to British Airways not to the CRS/GDS Companies, the activity of CRS/GDS Companies is not covered by Section 65(105)(zh) read with Section 65(75), is also not acceptable, as there is no such requirement in Section 65(105(zh), Section 65(75) or section 65(36) of the Finance Act, 1994. The learned Member (Judicial) in his order has also held that the activities of CRS Companies would fall under the category of the services i.e. Online Information and database access or retrieval service. The difference of opinion between two members as to whether the Branch Office of British Airways is liable to discharge the service tax liability on reverse charge mechanism or otherwise. The matter was referred to the 3rd Member. The 3rd Member in the said decision at paragraph 39 held as under:-
39. Both the Members have agreed that the services in dispute are covered by the definition of 'Online Data Based Access and/or retrieval service' as defined in Section 65(75) read with Section 65(36) of the Finance Act, 1994, and attracts service under Section 65(105)(zh). The point of difference is relatable to the fact as to whether British Airways, India, has received the service provided by the CRS/GDS companies located abroad or whether British Airways, UK have to be treated as recipient of the said services. 9.3 It can be seen from the above reproduced findings recorded in the case of British Airways categorically holds that the activities of CRS Companies would fall under the category of online information and database access or retrieval service. Nothing was brought to our notice which would require revisit of the said views as held by the Tribunal. We note that identical views were expressed by the Bench in the case of Austrian Airways - 2014-TIOL-1574-CESTAT-Del and Thai Airways International Public Company Ltd.. 2013-TIOL-1117-CESTAT-Del.
9.4 We find that all these three judgements as cited hereinabove are difference of opinion decided by a 3rd Member. All these three judgements categorically record and hold that the activities rendered by CRS Companies are classifiable under online information and database access or retrieval service. On the base of such authoritative decision, we do not find any compelling reason to revisit the same or refer the matter to any other Larger Bench. In view of this, we hold that the classification of the activities of CRS Companies as provided to the appellant are correctly held under the category of online information and database access or retrieval service.
9.5 Another point which was raised by the learned Sr. Counsel that the judgement of the Tribunal in the case of United Telecom Ltd. (supra) and SBI (supra) needs to be considered for coming to the conclusion as to the taxability of the services as ownership of data is not the CRS Companies but the appellant. In our considered view this argument also fails on the face of the fact that an identical issue has been decided by the Tribunal in the case as reproduced herein above.
10. On the issue of revenue neutrality, very many arguments were put forth by both sides. Learned Sr. Counsel submitted that appellant herein is also rendering taxable services of transport of passengers through air and other services on which they are discharging the service tax as output service provider hence any amount which need to be paid as service tax liability under reverse charge mechanism was eligible to be availed as CENVAT credit. Per contra learned A.R. had argued that the appellant had rendered taxable as well as exempted services hence could not have availed the CENVAT credit as per the provisions of Cenvat Credit Rules, 2004 and Cenvat Credit Rules need to be gone into detail as to come to a conclusion whether the appellant is eligible for the entire CENVAT credit.
10.1 We find that the arguments put forth by learned Sr. Counsel on the Revenue neutrality may merit acceptance for more than one reason.
10.2 Firstly, it is undisputed that the service tax liability on the payments made by appellant to CRS Companies is on reverse charge mechanism as if the appellant is a service provider. The said service tax liability has arisen on the tickets issued by the CRS Companies to various customers of appellant. It is also undisputed that the appellant herein has discharged the service tax liability as an output service provider in respect of the services rendered by the appellant under the category of transport of passenger by air and other services. If that be so, appellant is eligible to avail the CENVAT credit on all the services on which service tax is paid and utilized for rendering such output service.
10.3 Secondly, it is nobodys case that the service tax liability on online information and database access or retrieval service is paid by the appellant in respect of the tickets issued which are directly linkable to the output services provided by the appellant.
10.4 In our considered view the appellant could have availed CENVAT credit of the service tax paid on reverse charge mechanism as they are liable to pay tax on output service hence Revenue neutral situation arises wherein appellant pays the tax and takes the credit. We note that the issue as to confirmation of service tax liability arsse on the payment made to CRS Company, as decided by majority decisions in three cases namely British Airways, Thai International Public Co. Ltd. and Austrian Airways wherein the question of revenue neutrality arose, which was answered in favour of assesses therein. It is trait law that question of Revenue Neutrality is a good ground, more so when the tax liability is being discharged under reverse charge mechanism. This very plea of revenue neutrality in an identical issue was raised in British Airways case and decided also. It is settled law when an issue is raised and decided in a judgement, the ratio applies.
10.5 Thirdly, it has to be recorded that to uphold against the appellant on merits, we have relied upon the decisions of the Tribunal in the case of British Airways, Thai International Public Co. Ltd. and Austrian Airways; in the decision of British Airways, the Technical Member has in paragraph No.32 in respect of revenue neutrality situation has recorded as under:-
32. As regards the question of longer limitation period under Proviso to Section 73(1) of the Finance Act, 1944, the same would not be available to the Department, as no intention to contravene the Provisions of Finance Act, 1994 and of the rules made there under can be attributed to the Appellant for the reason that even if they are required to pay service tax on the service, in question, provided by CRS/GDS Companies, the entire service tax paid would be immediately available to them as Cenvat Credit and collection of service tax from the Appellant would be a revenue neutral exercise. A Larger Bench of the Tribunal in case of Jay Yushin Ltd. reported in 2000(119) ELT -718, has held that in such circumstances where revenue neutral situation comes about in relation to the credit available to the assessee himself of the duty paid by him and not by the way of availability of credit to the buyer of the assessee's manufactured goods [para 13(b) of the judgment], longer limitation period under Proviso to section 11A (1) of Central Excise Act, 1994 would not be applicable. The ratio of this judgment is squarely applicable to the facts of this case, as the Provisions of Section 11A (1) of Central Excise Act, 1944 are in pari-materia with the Provisions of section 73 (1) of the Finance Act, 1994. Since in this case, intention to evade the tax is absent, the penalty under section 78 of Finance Act, 1994 would not be attracted. Learned Member (Judicial) in his order held that the revenue neutral situation does not arise.
10.6 The third Member on hearing the reference made held that the revenue neutral arguments merit acceptance. The specific findings of the learned Member (Judicial) as is under:-
51. I also find favour with the appellant's contention that the entire situation is Revenue neutral. Admittedly British Airways India is discharging its service tax liability in respect of air transportation tickets sold by them. The present demand confirmed against them, was admissible to them as Cenvat credit, which could have been further utilised for discharge of their service tax liabilities. I do not agree with the reasoning adopted by ld. Judicial Member that inasmuch as the tax has not been paid by them, the credit would not be available. The said finding is contrary to the law laid down by various Courts, including the Hon'ble Supreme Court. Admittedly, the demands stand raised by invoking the longer period of limitation and during the relevant period, there was no service tax being paid by M/s British Airways India and as such the question of availability of credit of the same would become relevant only once the demands stand raised subsequently on a disputed issue. Had they been paying the service tax during the relevant period, they would have been availing the credit of the same and utilising the same for discharge of admitted service tax liability, leading to Revenue neutral situation. The question of availability of credit in a subsequently raised confirmed demand would arise only at the time of finalisation of the demand itself. Reference in this regard can be made to the Hon'ble Supreme Court's decision in the case ofFormica India - 1995 (77) ELT 511 (SC) = 2002-TIOL-599-SC-CX, wherein the Hon'ble Supreme Court has held that when an assessee is contesting the correctness of the demand, he could not have followed the procedure of Rule 56A (erstwhile) for the claim of set-off, which has to be extended, if the demand is ultimately upheld. It is only when after the demand stands confirmed, against an assessee, who is even challenging the same on merits, he can always take an alternative plea of availability of the demand as Cenvat credit to him leading to Revenue neutral situation. As such, even on this count, the appellant is bound to succeed.
52. I am also of the view that the demand, having been raised by invoking the longer period of limitation is hit by the provisions of Section 11A of the Act. My ld. Brother Shri D.N. Panda in his proposed order has held that inasmuch as the appellant was not registered under the Act and failed to file return periodically their plea of bona fide belief does not arise and there was a deliberate breach of law to cause evasion. I am afraid that I do not find myself in agreement with the said observations made by my brother. If non-registration and non-filing of returns is the criteria for rejecting the appellant's plea of bona fide belief and holding against them, the plea of limitation would not be available to any assessee, inasmuch as the service tax liabilities would arise only in those cases where the appellants are not registered and are not filing the returns.
10.7 In our considered view, we have to read the order holistically, i.e. British Airways case; on merits is against the appellant in this case while on the issue of revenue neutrality the order of British Airways supports appellants case. The ratio of the Bench applies clearly to the case in hand accordingly respectfully following to ratio we have to hold that the appellant has made out a case in their favour on the question of revenue neutrality. In view of a direct decision on the self same issue, we are not recording any findings on other case laws relied upon by both sides on the question of revenue neutrality.
10.8 As regards the submissions made by the learned Commissioner (A.R.) as to the services rendered by the appellant being exempted we find that since identical issue was before the Tribunal in the case of British Airways the ratio laid down needs to be followed by us for all the issues raised and decided.
10.9 The above said view of the Tribunal has been followed by this Bench in the case of Jain Irrigation System Ltd. 2015 (40) STR 752 wherein the situation of revenue neutrality was claimed on the tax payable under reverse charge mechanism and was held in favour of the assessee.
11. In view of the foregoing, we hold against the appellant on the revenue neutrality situation. With regard to service tax liability, interest thereof and penalty, we hold in favour of the appellant and set aside the demands, interest and penalties imposed and allow the appeals.
(Pronounced in Court on.) (C.J. Mathew) Member (Technical) (M.V. Ravindran) Member (Judicial) nsk 1 24 Appeal No. ST/87494 to 87498/13