Case Law Details
NCR Corporation India Private Limited Vs Commissioner Of Central Tax (CESTAT Bangalore)
Conclusion: Since the definition of Business Support Service was amended w.e.f. 01.05.2011 to include ‘operational or administrative assistance in any manner’ hence, the services in relation to operational and administrative assistance could only be taxed post the said amendment and not before that.
Held: Assessee-company were engaged in the manufacturing, trading and maintenance of Automated Teller Machines (ATM) and registered with the Service Tax Department for the taxable services falling in the category of Scientific and Technical Services, ATM Operation Services, Management, Maintenance or Repair Services, Renting of Immovable Property Services, Business Support Services, Business Consultancy Services, etc. Assessee-company during the relevant period had its manufacturing facilities in India in a 100% Export Oriented Unit in Pondicherry and in another DTA Unit. The issue arose for consideration was whether assessee was liable to pay service tax for Group Company cross charge received from its overseas group company, under BSS category. As per AO, assessee had received professional service on the basis of the Integrated Services Agreement which tantamount the outsourcing of export services liable to service tax under the category of Business Support Service. On the other hand, the stand of assessee was that the foreign exchange payments made to overseas affiliates were towards reimbursement on salary cost and other overheads by managerial personnel of NCR overseas group companies, working for NCR group as a whole. Further, as per assessee, the relationship of service provider and service recipient was missing as per the agreement between the parties. It was held that even if it was assumed that under the Integrated Services Agreement, the foreign company was providing any operational or administrative assistance to assessee, then the same should be taxable only w.e.f. 01.05.2011 and not prior to that. The definition of Business Support Service was amended w.e.f. 01.05.2011 to include “operational or administrative assistance in any manner”. Hence, the services in relation to operational and administrative assistance could only be taxed post the said amendment and not before that. It was settled principle in law that when the scope of the taxable service was expanded, it would have only prospective effect. Further, it was not disputed that w.e.f. 01.05.2011, assessee was paying the service tax under the category of Business Support Service hence the confirmation of demand under the Business Support Service for the disputed period was not sustainable in law and therefore this issue was decided in favour of assessee.
FULL TEXT OF THE CESTAT BANGALORE ORDER
The present appeal is directed against the impugned order dated 18.04.2016 passed by the Commissioner of Service Tax whereby the Commissioner has confirmed the following:
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