Commissioner of Central Goods and Service Tax Vs Gillette India Ltd. (CESTAT Mumbai)
The Revenue filed an appeal against the Order-in-Appeal dated 05.03.2018 passed by the Commissioner of CGST & Central Excise, Thane Rural, Mumbai, which had set aside the Order-in-Original confirming service tax demands, interest and penalties against the respondent-assessee.
The respondent-assessee was engaged in the manufacture of male grooming products and was registered for various taxable services, including Business Auxiliary Service, Consulting Engineers’ Service and Intellectual Property Service received from overseas service providers. During investigation, the department found that the respondent was paying royalty to its overseas group company for use of technology and brand names and had claimed exemption under Notification No. 17/2004-ST dated 10.09.2004 without paying service tax under Section 66A of the Finance Act, 1994. Show cause notices were issued for the periods 2007-08 to 2011-12 and 01.04.2012 to 30.06.2012, demanding service tax of Rs. 92,21,884/- and Rs. 13,62,519/-, respectively. The adjudicating authority confirmed the demands and imposed penalties under Sections 76 and 78. On appeal, the Commissioner (Appeals) set aside the adjudication order and granted consequential relief to the respondent. The Revenue challenged that order before the Tribunal.
The Revenue argued that the exemption under Notification No. 17/2004-ST was available only to the provider of intellectual property services and not to the recipient liable to pay tax under Section 66A. It further relied upon Indian National Shipowners Association Vs. Union of India to contend that the levy under Section 66A was distinct from the levy under Section 66 of the Finance Act, 1994.
