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(e) As per software development agreement dated 06th May 2002 with ICICI Webtrade, it is providing hosting management service and additional services including software development, customization, maintenance of both in-house development and those procured from 3rd parties and support services.
(f) As per the earlier CESTAT order dated 14.01.2003, liability to service tax would arise only in respect of software which the appellant have developed as per customers' specification and supplied Appeal No. ST/85707/14 to customer. Matter was remanded to AA for going through the agreement, bills raised and payment towards service tax liability under "Information Technology Services." As per appellants' reply dated 11.11.13 demand on account of sale of 3rd Party software is Rs 10.2 Crores, whereas demand on account of in house developed software, development and customization of software is Rs 51.37 Crores. As per them, sale of software is not provision of service.

v. Software development agreement dated 6.05.2002 with ICICI Webtrade, is for development of customized Software development service and falls under the category of Information Technology Software Service (ITSS) after 16.05.2008 and liable to service tax. Since this service was notified as liable to service tax from 16.05.2008, they have paid the service tax in respect of these services with effect from that date.

vi. Apex Court decision in case of Tata Consultancy Services [2004 (178) ELT 22 (SC)] is relevant both Appeal No. ST/85707/14 prior to and after 16.05.2008 and the sale of copy of computer programme would still be sale of goods and not services.

"45. So far as the present case is concerned, there is no dispute about the fact that the software developers like Oracle had developed the software and given right to Appeal No. ST/85707/14 distribute such software to the end users on entering the end users license agreement. The intellectual property right in respect of the program remained with the said developer of software and the end user were only using the data contained in the software in furtherance of their business. In other words, the said software developers had only transferred the right to use the software temporarily. The Noticee acted as an intermediate on behalf of the software developers in transferring the intellectual property right. As such, the Noticee, being the 'holder' of the intellectual property right by way of the agreement entered by them with the software developers like oracle, are the provider of the 'intellectual property services', defined under Section 65(55b) of the Finance Act, 1994 read with Section 65(105)(zzr) ibid. Even in respect of the software developed in-house or customized software, as brought out in the above paras, the Noticee were only transferring the right to use the program contained in the software and the intellectual property rights and ownership of such software supplied to the customers, remained with the Noticee only. Thus, even in respect of the supply of software developed in- house or customized software, the services provided by the Noticee are classifiable under the category of the 'intellectual property services'.

51. In view of the clarification of CBEC given vide the above said circular dated 29.02.2008, so far as first Show Cause Notice dated 19.10.2009 is concerned, the services provided by the Noticee in respect of the supply of the third party software and the software developed in-house or the customized software, wherein the Noticee had temporarily transferred the right to use the software to their clients for consideration, are classifiable under the category of 'Intellectual Property Services' for the period prior to 16.05.2008 and with effect from 16.05.2008 the said services are classifiable under the separately specified category of 'Information Technology Software services'.