Custom, Excise & Service Tax Tribunal
Sun Micro Systems (P) Ltd vs Commissioner Of Central Excise, ... on 3 January, 2014
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL SOUTH ZONAL BENCH BANGALORE Final Order No. 20016 / 2014 Appeal(s) Involved: ST/184/2008-SM [Arising out of Order-in-Appeal No. 149-2007 dated 30/11/2007 passed by the Commissioner of Central Excise, Bangalore] Sun Micro Systems (P) Ltd. VI Floor, Divyshree Chambers, Off Longford Road, Bangalore Appellant(s) Versus Commissioner of Central Excise, Customs and Service Tax - Bangalore-I Post Box No 5400,CR Buildings, Bangalore - 560 001, Karnataka Respondent(s)
Appearance:
Mr. I.S. Karthikeyan, Advocate 505-508, North Block, Brigade Plaza, 71/1, Subedar Chatram Road, Anand Rao Circle, Bangalore - 560 009 For the Appellant Mr. S. Teli, Deputy Commissioner (AR) For the Respondent CORAM:
HON'BLE SHRI B.S.V. MURTHY, TECHNICAL MEMBER Date of Hearing: 03/01/2014 Date of Decision: 03/01/2014 The appellant is engaged in providing marketing and sales promotion services for the products of Sun Micro Systems India. The consideration for the service provider is received in convertible foreign currency. Prior to 01.03.2003, the services rendered by the appellant was considered to have been exported since according to Notification No. 6/99, any service for which the consideration received in convertible foreign currency was considered to have been exported. This notification was rescinded w.e.f. 01.03.2003. Department entertained a view that the appellants services which were rendered to Sun Micro Systems cannot be considered as export and therefore appellant should discharge the service tax liability for the period from 01.03.2003 to 20.11.2003, the date on which another notification was issued which covered the services rendered by the appellants and gave them the benefit of treatment as export of services. The appellants paid the service tax demand but filed a refund claim claiming that the service was to be considered to have been exported and they were not liable to pay tax. The claim has been rejected.
2. Learned counsel on behalf of the appellant submits that the issue is covered in its entirety by the decision of the Tribunal in the case of Mapal India Pvt. Ltd. Vs. CCE, Bangalore reported in [2011 (22) S.T.R. 454 (Tri.-Bang.)]. On going through the decision, I find that in paragraph 4 and 4.1, views expressed by the Tribunal are in favour of the appellant. For better appreciation I reproduce the relevant paragraph:
4. We find that there is no dispute that during the material period, the appellant promoted sale of precision tools manufactured by MAPAL, Germany and received consideration in convertible foreign exchange. Notification No. 6/1999-S.T., dated 9-4-1999 exempted taxable services from Service Tax in respect of which consideration was received in convertible foreign exchange. This Notification was rescinded on 1-3-2003. Vide Circular No. 56/5/2003-S.T., dated 25-4-2003, the CBEC clarified that export of services would continue to remain tax free even after rescinding of Notification No. 6/1999-S.T., dated 9-4-1999.
4.1 As per Notification No. 13/2003-S.T., dated 20-6-2003, a commission agent is a person who causes sale or purchase of goods, on behalf of another person for a consideration which is based on the quantum of such sale or purchase. The revenue has no case that MIPL was not a commission agent as per the above definition. Therefore, during the period 1-7-2003 to 20-11-2003, the services rendered by MIPL could not have been validly found to be liable to Service Tax paid by the assessee. As per the Circular also, since the assessee received consideration in foreign exchange, the impugned services continued to be exempt during the period 1-3-2003 to 20-11-2003. As for the period 15-3-2005 to 30-11-2006, the recipient of the impugned services involved was located outside India. As per Circular No. 111/5/09-S.T., dated 24-2-2009 clarifying the scope of Export of Services Rules, 2005, inter alia, BAS provided to a recipient located outside India was services exported in terms of sub-rule (1) of Rule 3 of Export of Services Rules, 2005. In ABS India Ltd. v. Commissioner of Service Tax, Bangalore - 2009 (13) S.T.R. 65 (Tri.-Bang.) relied on by the appellant, the Tribunal held that booking of orders for sale of goods manufactured by the subsidiary of the appellant therein located in Singapore was services exported and the appellant was not required to pay Service Tax. The Tribunal allowed the appeal filed by ABS India Ltd. accepting the claim that services delivered to a company located abroad was also utilized abroad as the beneficiary was a foreign company. In Blue Star Ltd. v. CCE, Bangalore - 2008 (11) S.T.R. 23 (Tri.-Bang.), the Tribunal held in a case of similar facts where the appellant had canvassed orders for the products manufactured by its foreign principal, the services involved were exported and the appellants therein were entitled for refund of the Service Tax already paid on the said services. I find that the issue involved in the present case is covered by the decision cited above. Learned AR is not able to show any contrary decision at this stage. Accordingly in view of the precedent Tribunal decision, the appeal has to be allowed and appeal is accordingly allowed with consequential relief, if any, to the appellant.
(Order dictated and pronounced in open court) (B.S.V. MURTHY) TECHNICAL MEMBER iss