Custom, Excise & Service Tax Tribunal
Prasad Corporation Limited vs Commissioner Of Gst&Cce (Chennai ... on 8 January, 2026
CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL
CHENNAI
REGIONAL BENCH - COURT No. III
Service Tax Appeal Nos. 42295 to 42298 of 2015
(Arising out of Order-in-Original Nos. 16-19/2015 dated 14.08.2015 passed by Commissioner
of Service Tax, Newry Towers, No. 2054-I, 12th Main Road, Anna Nagar, Chennai - 600 040)
M/s. Prasad Corporation Ltd. ...Appellant
No. 28, Arunachalam Road,
Saligramam,
Chennai - 600 093.
Versus
Commissioner of GST and Central Excise ...Respondent
Chennai Outer Commissionerate, Newry Towers, No. 2054-I, 12th Main Road, Anna Nagar, Chennai - 600 040.
And Service Tax Appeal No. 41777 of 2018 (Arising out of Order-in-Original No. 8/2018 dated 27.02.2018 passed by Commissioner of GST and Central Excise, No. 692, M.H.U Complex, 5th Floor, Anna Salai, Chennai - 600 035) M/s. Prasad Corporation Ltd. ...Appellant No. 28, Arunachalam Road, Saligramam, Chennai - 600 093.
Versus Commissioner of GST and Central Excise ...Respondent Chennai South Commissionerate, No.692, MHU Complex, 5th Floor, Anna Salai, Nandanam, Chennai - 600 035 APPEARANCE:
For the Appellant : Mr. Raghavan Ramabadran, Advocate For the Respondents : Mr. Sanjay Kakkar, Authorised Representative CORAM:
HON'BLE MR. P. DINESHA, MEMBER (JUDICIAL) HON'BLE MR. VASA SESHAGIRI RAO, MEMBER (TECHNICAL) 2 FINAL ORDER Nos. 40004-40008 / 2026 DATE OF HEARING : 01.08.2025 DATE OF DECISION : 08.01.2026 Per Mr. VASA SESHAGIRI RAO These Appeals ST/42295 to 42298/2015 (Sl. Nos 1 to 4 of the Table given below) and ST/41777/2018 (Sl. No 5 of the Table) have been filed by M/s. Prasad Corporation Ltd. Chennai (hereinafter referred to as 'the Appellant') against the Order-in-Original Nos. 16 to 19/2015-16 dated 14.08.2015 and Order-in-Original No. 08/2018 dated 27.02.2018 passed by the Commissioner of Central Tax / Service Tax, Chennai ('impugned order' for short) , whereby service tax demands were confirmed against the Appellant along with levy of interest and imposition of penalties under the provisions of the Finance Act, 1994, as tabulated below: -
Order-in-
Sl. SCN / SOD No. Period of Service Tax
Original No. & Interest Penalty
No. & Date Dispute Demand (₹)
Date
SOD No. OIO No. 16- Confirmed Imposed
April 2011 -
1 180/2013 dated 19/2015-16 1,60,38,512/- under Section under
March 2012
24.05.2013 dated 14.08.2015 75 Section 76
SOD No. OIO No. 16- Confirmed Imposed
April 2012 -
2 95/2014 dated 19/2015-16 56,36,271/- under Section under
June 2012
30.04.2014 dated 14.08.2015 75 Section 76
SCN No. OIO No. 16- Confirmed Imposed
July 2012 -
3 221/2014 dated 19/2015-16 2,40,02,166/- under Section under
March 2013
09.09.2014 dated 14.08.2015 75 Section 76
SOD No. April 2013 - OIO No. 16- Confirmed Imposed
4 44/2015 dated September 19/2015-16 2,33,76,872/- under Section under
23.04.2015 2014 dated 14.08.2015 75 Section 76
SOD No. Confirmed Imposed
October 2014 OIO No. 08/2018
5 04/2017 dated
- June 2017 dated 27.02.2018
6,40,95,934/- under Section under
10.10.2017 75 Section 76
3
Order-in-
Sl. SCN / SOD No. Period of Service Tax
Original No. & Interest Penalty
No. & Date Dispute Demand (₹)
Date
Total 13,31,49,755/-
2.1 The Appellant, is registered under the Service
Tax for Photography Services, Management, Maintenance & Repair Services and Information Technology Services. The Appellant is engaged in specialised post-production film activities such as Computer Graphics, Digital Restoration and Reverse Telecine, which involve manipulation and processing of digitised image data received from customers.
2.2 The Appellant provides these services both to domestic customers and customers located outside India. Service tax was discharged on services rendered to domestic customers. In respect of services rendered to foreign customers, the Appellant did not discharge service tax on the ground that such transactions constituted export of services. 2.3 For the period 01.04.2011 to 30.06.2017, various Statements of Demand / Show Cause Notices were issued proposing to demand service tax, interest and penalties, primarily on the allegations that: -
i. the services are classifiable as Video Tape Production Services (for the pre-negative list period); 4 ii. the services do not qualify as export under the Export of Services Rules, 2005 (pre-01.07.2012); iii. post-01.07.2012, the place of provision of service is in India under Rule 4 of the Place of Provision of Services Rules, 2012; and, iv. Consequently, all conditions of Rule 6A of the Service Tax Rules, 1994 are not satisfied.
2.4 The demands were confirmed vide Order-in-
Original No. 16 to 19/2015-16 dated 14.08.2015 and Order- in-Original No. 08/2018 dated 27.02.2018, leading to the present appeals. As the issues involved are identical, all these appeals are being taken up together for disposal by this common order.
3. The Ld. Advocate Mr. Raghavan Ramabadran, appeared on behalf of the Appellant and advanced detailed submissions in support of the Appellant Assessee and the Ld. Authorized Representative Mr. Sanjay Kakkar, appeared for the Revenue and capably defended the Impugned Orders.
4. The contentions / submission of the Ld. Advocate Mr. Raghavan Ramabadran are summarized as follows: -
4.1 That for the period prior to 01.07.2012, the impugned demands proceeded on the erroneous assumption that the Appellant's activities are classifiable under "Video 5 Tape Production Services" as defined under Section 65(120) read with Section 65(105)(zi) of the Finance Act, 1994. 4.2 That the statutory definition mandates recording of a programme, event or function. The Appellant admittedly does not record any programme, event or function. Its activities are confined to post-production processing of already recorded digital image data, without any audio component. Consequently, the essential ingredients of the taxable service are absent.
4.3 That this issue stands conclusively settled in favour of the Appellant by a series of decisions of Chennai Tribunal in the Appellant's own case, namely: -
i. Prasad Corporation Ltd. v. CST, Chennai - 2018 (11) GSTL 104 (Tri.-Chennai) ii. Prasad Corporation Ltd. v. CGST & CEx., Chennai - 2019 (1) TMI 506 iii. Prasad Corporation Ltd. v. CST - 2021 (1) TMI 384 Revenue appeals against the said orders were either dismissed or withdrawn. Hence, the issue is no longer res integra, and judicial discipline mandates that the demands for this period be set aside.
4.4 That without prejudice, the Appellant submits that identical services rendered to domestic customers were accepted by the Department as taxable under IT-enabled services, and service tax was duly discharged. The 6 Department cannot adopt inconsistent classifications for the same activity based solely on the location of the recipient. 4.5 That for the post-negative list period (01.07.2012 to 30.06.2017), the demands have been confirmed on the grounds that the services do not fall under the negative list and that Rule 4 of the Place of Provision of Services Rules, 2012 is applicable.
4.6 That the Appellant submits that the activity of recording/restoring digital data on new storage media amounts to manufacture in terms of Chapter Note 10 to Chapter 85 of the Central Excise Tariff Act, 1985. The Hon'ble Supreme Court in Gramophone Co. of India Ltd.
[1999 (114) ELT 770 (SC)] has held that recording on blank media results in a distinct product and constitutes manufacture. Services amounting to manufacture fall under Section 66D(f) of the Finance Act, 1994 and are therefore not exigible to service tax.
4.7 That Rule 4 of the POPS Rules applies only where services are performed on goods required to be made physically available. In the present case, the services are rendered on intangible digital data, often transmitted 7 electronically. Physical availability of goods is not a pre- condition.
4.8 That the Ld. Advocate submits further that reliance on Tata Consultancy Services v. State of A.P[2004 TMI 4142 SC] is misplaced, as that decision dealt with software supplied on media as the subject of sale, whereas in the present case the physical media is merely incidental and not the object of the service. The CBEC Education Guide dated 20.06.2012 also clarifies that Rule 4 applies only where physical possession of goods is essential, which is absent here.
4.9 That once Rule 4 is excluded, Rule 3 of the POPS Rules applies, and the place of provision is the location of the service recipient, which is outside India. Accordingly, all conditions of Rule 6A of the Service Tax Rules, 1994 are satisfied and the services qualify as export of services. This position stands settled by binding precedents including Prime Focus Ltd. [2023 (71) GSTL 402 (Tri.-Mumbai)], affirmed by the Hon'ble Supreme Court [2023 (385) ELT 806 (SC)], and Futureworks Media Ltd. [2024 (6) TMI 307 (CESTAT Mumbai)].
4.10 He has argued that when the demand itself is unsustainable, interest and penalties cannot survive. In any 8 event, the issue involves interpretation of law and has been consistently decided in favour of the Appellant. There is no suppression, fraud or intent to evade tax. Hence, penalties under Sections 76/77 and interest under Section 75 are not sustainable, and Section 80 (as applicable) warrants waiver of penalty.
4.11 The Ld. Advocate has further submitted that in view of the settled legal position, binding precedents and undisputed facts, the impugned Orders-in-Original be set aside in toto and the appeals be allowed with consequential relief.
5.1 The Ld. Authorized Representative Mr. Sanjay Kakkar have firstly reiterated the findings in the impugned orders. He has further submitted that: -
5.2 The services involve imparting special effects and post-production activity covered under the inclusive definition of Video Tape Production Services and the entire activity is performed in India;
5.3 Digital data constitute "goods" following the judgment in Tata Consultancy Services v. State of A.P[2004 TMI 4142 SC] therefore, Rule 4 of the Place of Provision Rules squarely applies;9
5.4 The conditions of Rule 6A of ST Rules are not satisfied and the services are taxable in India. 5.5 He has further contended that the activities undertaken by the Appellant do not amount to manufacture, as no new and distinct product emerges, and hence the negative list under Section 66D(f) of FA 1994 is not attracted.
5.6 The Ld. Authorized Representative therefore prayed for dismissal of the appeals and for upholding the demands of service tax, interest and penalties as confirmed in the impugned orders.
6. We have carefully heard the submissions advanced by both the sides, examined the appeal records in detail, considered the statutory provisions, notifications and circulars and the case Laws cited by both the sides.
7. Upon such comprehensive consideration, the following issues arise for our determination in this appeal as to: -
i. Whether the services rendered by the Appellant are classifiable as "Video Tape Production Service" for the period prior to 01.07.2012?10
ii. Whether the services rendered by the Appellant to overseas clients qualify as "export of services" under the Export of Services Rules, 2005 and Rule 6A of the Service Tax Rules, 1994 read with the Place of Provision of Services Rules, 2012?
iii. Whether Rule 4 or Rule 3 of the Place of Provision of Services Rules, 2012 is applicable for determining the place of provision of the impugned services? iv. Whether the demands of service tax along with interest and penalties confirmed under the impugned Orders-in- Original are sustainable in law?
8. We take up the issues in seriatim.
8.1 Before adverting to the specific questions framed for our consideration, it would be apposite to briefly note the scope of the present appeals. The Appellant has assailed two Orders-in-Original, both of which arise from demands of service tax confirmed on the very same set of activities carried out by the Appellant.
8.2 The first impugned Order-in-Original covers a composite period spanning both the pre-negative list regime 11 as well as the post-negative list regime, i.e., periods governed respectively by the taxable service definitions under Chapter V of the Finance Act, 1994 and by the levy under Section 66B read with the Negative List and the Place of Provision of Services Rules, 2012.
8.3 The second impugned Order-in-Original, however, pertains exclusively to the period post 01.07.2012, under Section 66B read with the Negative List and the Place of Provision of Services Rules, 2012.
8.4 Since the nature of the services rendered by the Appellant remains identical in both the impugned orders, albeit examined under two different statutory regimes, we proceed to analyse the issues arising in these appeals issue-
wise and question-wise, keeping in view the applicable legal framework for the respective periods.
Question No. 1 Whether the activities carried out by the Appellant, namely Computer Graphics, Digital Restoration and Reverse Telecine, are classifiable as "Video Tape Production Service" under Section 65(105)(zi) read with Section 65(120) of the Finance Act, 1994, for the period prior to 01.07.2012?
129.1 The Appellant submits that its activities are post- production digital services involving manipulation and restoration of image data using specialized software and high-end computer systems.
9.2 It was contended that the Appellant does not record any programme, event or function; No audio content is handled; The services are rendered on pre-existing cinematographic footage, supplied in digital form by its clients.
9.3 It is argued that the statutory definition of "Video Tape Production" under Section 65(120) of FA 1994 is restrictive, using the word "means", and covers only:
Recording of programmes/events/functions, and Activities incidental or ancillary to such recording. 9.4 The Appellant relied on a series of decisions in its own case, including: -
i. Prasad Corporation Ltd. v. CST, Chennai, 2018 (11) GSTL 104 (Tri.-Chennai) ii. Prasad Corporation Ltd. v. CCE, 2019 (1) TMI 506 -
CESTAT Chennai iii. Prasad Corporation Ltd. v. CST, 2021 (1) TMI 384 -
CESTAT Chennai Wherein it was held that such identical services do not fall under Video Tape Production Service.
139.5 It was further submitted that Revenue appeals against these orders were either dismissed or withdrawn, and therefore the issue has attained finality. 9.6 Whether the Department contends that the Appellant undertakes activities such as imparting special effects, processing, enhancement and conversion of digital images to film and these activities are specifically included in the inclusive portion of Section 65(120). 9.7 It was argued that even if recording is not undertaken by the Appellant, the post-production activities are sufficient to bring the service within the ambit of "Video Tape Production".
9.8 We have carefully examined the statutory definition and the factual nature of the services rendered. 9.9 Section 65(120) defines "Video Tape Production"
as: -
"the process of any recording of any programme, event or function on a magnetic tape or on any other media or device and includes services relating thereto such as editing, cutting, colouring, dubbing, title printing, imparting special effects, processing, adding, modifying or deleting sound, transferring from one media or device to another, or undertaking any video post-production activity, in any manner"14
9.10 The essential and foundational requirement under the definition is recording of a programme, event or function. The inclusive portion cannot expand the scope beyond the core activity.
9.11 In the present case, it is an undisputed fact that the Appellant does not undertake recording; the services are rendered on already recorded footage and the activity is purely post-production digital manipulation of data received from its clients.
9.12 We find that this Tribunal, in the Appellant's own earlier cases (supra), has consistently held that post- production digital services cannot be equated with video tape production service.
9.13 We find no change in facts or law warranting a departure from the settled view. Judicial discipline requires us to follow coordinate Bench decisions, particularly when affirmed by higher forums.
9.14 As such, we hold that the services rendered by the Appellant do not fall under "Video Tape Production Service" for the period prior to 01.07.2012. Thus, Question No. 1 is answered in favour of the Appellant. 15 Question No. 2 Whether the services rendered by the Appellant to foreign clients qualify as "export of service"
under the Export of Services Rules, 2005 (prior to 01.07.2012)?
10.1 The Appellant submits that its services fall under Rule 3(1)(iii) of the Export of Services Rules, 2005, being services used in relation to commerce or industry. 10.2 It is contended that: The service recipients are located outside India; Consideration is received in convertible foreign exchange and the benefit of service accrues to foreign clients.
10.3 It is argued that location of use and consumption, not physical performance, is determinative. 10.4 The Department contended that: The entire activity is performed in India; Under Rule 3(1)(ii), performance outside India is mandatory. 10.5 The Tribunal has already held in the Appellant's earlier cases that the services are classifiable under categories where recipient-based criteria apply. 16 10.6 The benefit of the service accrues to foreign clients, and the services are integrally used in their commercial activities abroad.
10.7 Identical demands for earlier periods have been set aside on this very reasoning.
10.8 So, we hold that the services rendered to foreign clients qualify as export of services prior to 01.07.2012. Question No. 3: Whether Rule 4 or Rule 3 of the Place of Provision of Services Rules, 2012 is applicable for determining the place of provision of the impugned services? 11.1 The Appellant submitted that Rule 4 of the POPS Rules, 2012 applies only where services are performed on goods which are required to be made physically available to the service provider.
11.2 In the present case, the services rendered are digital post-production services such as computer graphics, digital restoration and reverse telecine, performed on intangible digital data, and not on the physical storage media.
1711.3 The digital data is frequently transmitted electronically through the internet and cloud-based mechanisms, clearly demonstrating that physical availability of goods is not a sine qua non for rendering the service. 11.4 The physical media (LTO tapes / hard disks) used is merely incidental and only a mode of transmission, and never the object of the service. Therefore, Rule 4 is wholly inapplicable.
11.5 The Appellant places reliance on:
i. Commissioner v. Prime Focus Ltd. - 2023 (71) GSTL 402 (Tri.-Mumbai), affirmed by the Hon'ble Supreme Court in 2023 (385) ELT 806 (SC) ii. Futureworks Media Ltd. v. CCGST - 2024 (6) TMI 307 (CESTAT Mumbai) where identical services were held to be governed by Rule 3 and treated as export of services.
11.6 The CBEC Education Guide dated 20.06.2012 clarifies that Rule 4 applies only when temporary physical possession or control of goods is essential for rendering the service, which condition is absent in the present case. 12.1 But we find that the Department contends that since the digital data is received on physical media such as tapes or hard disks, the goods are made physically available to the Appellant, and therefore Rule 4(a) of the Place of Provision of Services Rules, 2012 applies. 18
12.2 Reliance was placed on Tata Consultancy Services v. State of A.P 2004(11) TMI 11 (SC) LB. to argue that intangible data embedded in physical media constitutes goods.
12.3 It was argued that the services are performed in India and hence taxable in India.
13.1 We have carefully examined the rival submissions. Rule 4(a) of the POPS Rules applies only where services are provided in respect of goods which are required to be made physically available to the service provider. 13.2 The decisive test is whether physical possession of goods is essential for rendering the service. In the present case, the services are rendered on intangible digital data, and not on the physical medium.
13.3 The admitted fact that the same services are rendered even when data is transmitted electronically completely negates the applicability of Rule 4. 13.4 We are of the view that the reliance placed on Tata Consultancy Services (supra) is misplaced as contended 19 by the appellant. That decision dealt with sale of software as goods, where the physical medium itself was the subject of transaction. In the present case, the physical media is merely incidental and not the subject matter of service. Therefore the said decision is distinguishable from the facts obtaining in these appeals.
13.5 Thus, the issue stands squarely covered by Prime Focus Ltd. (supra), affirmed by the Hon'ble Supreme Court, wherein it was categorically held that post-production and digital processing services rendered on electronic data are governed by Rule 3, and qualify as export of services. 13.6 Judicial discipline mandates that we follow the said binding precedent.
13.7 We hold that Rule 3 of the POPS Rules, 2012 applies. The place of provision is the location of the service recipient, which is outside India and therefore, Rule 4 is inapplicable.
Whether the services rendered by the Appellant during the period post-01.07.2012 qualify as "export of service" under Rule 6A of the Service Tax Rules, 1994?
14.1 The Appellant submitted that for the period post- 01.07.2012, the levy of service tax is governed by Section 20 66B of the Finance Act, 1994, read with the Negative List, Place of Provision of Services Rules, 2012 (POPS Rules) and Rule 6A of the Service Tax Rules, 1994.
14.2 Rule 6A(1) prescribes six cumulative conditions for a service to qualify as export of service. The Appellant submits that all the six conditions stand undisputedly satisfied in the present case.
14.3 It is not in dispute that: -
a) the service provider (the Appellant) is located in the taxable territory of India;
b) the service recipients are located outside India;
c) the consideration for the services has been received in convertible foreign exchange;
d) the Appellant and the foreign clients are not merely establishments of the same person.
14.4 The only ground on which export benefit was sought to be denied is Rule 6A(1)(d), namely, that the place of provision of service is not outside India. 14.5 The Appellant submits that the Department has erroneously applied Rule 4 of the POPS Rules. The services rendered are not services "in respect of goods required to be 21 made physically available". The services are performed on intangible digital data, which is often transmitted electronically, and not on physical media. 14.6 Once Rule 4 is excluded, the default Rule 3 of the POPS Rules applies, which stipulates that the place of provision of service shall be the location of the service recipient. Since the recipients are located outside India, the place of provision is also outside India. 14.7 Consequently, Rule 6A(1)(d) stands satisfied and the services provided qualify as export of services. 14.8 We have examined the Appellant's reliance on the following decisions: -
i. Commissioner of Service Tax v. Prime Focus Ltd. - 2023 (71) GSTL 402 (Tri.-Mumbai), affirmed by the Hon'ble Supreme Court in 2023 (385) ELT 806 (SC) ii. Futureworks Media Ltd. v. Commissioner of CGST - 2024 (6) TMI 307 (CESTAT Mumbai) iii. Prasad Corporation Ltd. v. CST, Chennai - 2018 (11) GSTL 104 (Tri.-Chennai) iv. Prasad Corporation Ltd. v. CGST & CEx. - 2019 (1) TMI 506 (CESTAT Chennai) v. Prasad Corporation Ltd. v. CST - 2021 (1) TMI 384 (CESTAT Chennai) 14.9 We have taken note of guidelines in CBEC Education Guide dated 20.06.2012 and Circular No. 209/1/2018-ST dated 04.05.2018, which clarify that services 22 involving digital processing of data or software are governed by Rule 3 of the POPS Rules.
14.10 However, the impugned orders contend that the services are performed entirely in India and hence the place of provision is within India that since the digital data is received on physical media such as LTO tapes or hard disks, the goods are made physically available to the Appellant, attracting Rule 4(a) of the POPS Rules.
14.11 Reliance is placed on Tata Consultancy Services v. State of Andhra Pradesh(SC2004) to contend that intangible data embedded in a medium constitutes "goods". On this basis, the Department submits that Rule 6A(1)(d) is not satisfied and the services cannot be treated as export of service.
14.12 We have carefully examined the rival submissions, statutory provisions and precedents cited on the above issue 14.13 Rule 6A of the Service Tax Rules, 1994 provides a complete code for determining whether a service qualifies as export. The only disputed condition in the present case is Rule 6A(1)(d) relating to the place of provision of service. 23 14.14 The determination of the place of provision must necessarily be made in accordance with the POPS Rules, 2012.
14.15 Rule 4 of the POPS Rules applies only where services are performed in respect of goods which are required to be made physically available to the service provider. The essential requirement is that physical possession or control of goods must be indispensable for rendering the service.
14.16 In the present case, the services rendered by the Appellant i.e., Computer graphics, digital restoration and reverse telecine are performed on intangible digital data. The physical media, if any, is merely a carrier of data and not the subject matter of service.
14.17 The admitted fact that the same services are rendered even when data is transmitted electronically establishes beyond doubt that physical availability of goods is not a pre-condition. Therefore, Rule 4 of the POPS Rules has no application.
14.18 The reliance placed on Tata Consultancy Services is misplaced. That decision dealt with the sale of software 24 recorded on physical media, where the medium itself was the subject of transaction. In the present case, the Appellant neither sells the media nor renders services on the media itself. Accordingly, the said judgment is clearly distinguishable.
14.19 Once Rule 4 is ruled out, the default Rule 3 of the POPS Rules applies. As per Rule 3, the place of provision of service shall be the location of the service recipient. 14.20 It is an undisputed fact that the service recipients are located outside India. Consequently, the place of provision of service is also outside India. 14.21 This precise issue has been conclusively settled by the Tribunal in Prime Focus Ltd. (supra), wherein it was held that post-production and digital processing services rendered to overseas clients constitute export of service. The said decision has been affirmed by the Hon'ble Supreme Court, thereby attaining finality.
14.22 The same view has been consistently followed in Futureworks Media Ltd. (supra) and in the Appellant's own earlier cases. Judicial discipline mandates that we follow these binding precedents.
2514.23 Once the place of provision is held to be outside India, all the conditions of Rule 6A(1) stand fulfilled. Accordingly, the services rendered by the Appellant post- 01.07.2012 qualify as export of service. 14.24 We hold that the services rendered by the Appellant during the period post-01.07.2012 satisfy all the conditions prescribed under Rule 6A of the Service Tax Rules, 1994, and therefore qualify as export of service. 14.25 Consequently, no service tax is leviable on such services under the Finance Act, 1994.
Issue (iv) Whether the demands of service tax along with interest and penalties confirmed under the impugned Orders- in-Original are sustainable in law?
15.1 The Appellant submits that once the activity is held to be either export of service or covered under the negative list, the very foundation of the demand collapses. 15.2 Consequently, interest under Section 75 and penalties under Sections 76/77 cannot survive. 26
15.3 Without prejudice, the issue is purely interpretational, supported by consistent Tribunal and Supreme Court's ruling, and hence penalties are unsustainable.
15.4 Upon consideration of the submissions of both the sides, we have already held that the impugned services qualify as export of services.
15.5 It is a settled law that when the principal demand fails, interest and penalties must also fail. Further, the issue has been consistently decided in favour of the Appellant, negating any allegation of suppression or intent to evade tax.
15.7 We hold that the demands of service tax, interest and penalties are wholly unsustainable in law.
16. Accordingly, the impugned Orders-in-Original are set aside in toto, and the appeals ST/42295 to 42298/2015 and ST/41777/2018 filed by the Appellant are allowed with consequential relief, if any, as per the law.
(Order pronounced in open court on 08.01.2026) Sd/- Sd/-
(VASA SESHAGIRI RAO) (P. DINESHA) MEMBER (TECHNICAL) MEMBER (JUDICIAL) MK