Based on the aforementioned observation, the CESTAT held that the software imported by Appellant was only modified packaged software and not „Customized Software? and would not be eligible to the exemption under the subject notification, which applies only to the Custom designed software. Hence, CESTAT upheld the impugned order passed by the Commissioner of Customs (Appeals) and rejected the appeal.
M/s. Nirulas Corner House Pvt. Ltd. („the Appellants?) were engaged in the food and confectionary business. They had entered into an agreement with M/s. Sagar to permit them to run restaurants in the name of “Nirulas” as per the specified plans with regard to the location of the restaurant, area, interiors and other details. As per the terms of the agreement, it is the Appellants who decide the items that are to be sold by the restaurant, the method of preparation of the items, the quality and the prices of the items. The Appellants have even placed their employees in the restaurants to supervise the operations.
In the case of supply of manpower individuals are contractually employed by the manpower recruitment or supply agency. The agency agrees for use for the services of an individual, employed by him to another person for a consideration.
We have considered the submissions made at length by both sides and perused the records. The issue for determination in this case is whether the reimbursable expenditure incurred by the appellant is chargeable to service tax or not. On perusal of the returns it appears that they had indicated this amount against the column marked as “amount billed for exempted services other than export”. It is also undisputed that the appellant has been taking this stand before the lower authorities that the amounts are reimbursable expenses. It was the claim of the appellant that they had received
Once the taxable service is exported and various input services have been utilized for providing the output service :i.e. appellants could be entitled for the rebate, which is equal to the service tax paid on the input services. Going by the definition of the input service under Rule 2(1) of the Cenvat Credit Rules, 2004 the service utilized by the appellants for providing output service can indeed be considered as input services.
We are of the considered opinion that the activity relating to one of the categories could not be subjected to service tax under other category. In other words, the activities relating to Freight forwarding cannot be thought under CHA. The appellants had clearly explained the nature of the charges collected such as Charge Collect fees, Break bulk fees, Profit share from margin Unallocated income, Currency adjustment factor, Air/sea Freight rebate, Commission/ Brokerage, Air freight incentive, Expenses reimbursement billing, etc.
The documents were not in the name of the assessee’s factory situated at Silvassa but the same were issued in the name of the head office of the assessee situated at Mumbai. However, I find that there is otherwise no dispute about the input services received by the assessee. The substantive benefit cannot be denied on the procedural grounds.
The appellant appears to have performed service in India for ultimate consumption thereof in India by its clients/customers in India. The service is destined to exhaust in India and extinct soon after performance thereof. Post performance liability only remains to be discharged by foreign principal through the appellant in India. Thus the beneficiaries of services were located in India for ultimate consumption of the service provided in India.
T.K. Jayaraman, Technical Member. – This appeal has been filed against the Adjudication Order No. 15/2007 (VR), dated 17-5-2007 passed by the Commissioner of Central Excise & Customs, Visakhapatnam-II Commissionerate. 2. Shri MSV Prasad, the learned Advocate, appeared on behalf of the appellants and Ms. Sudha Koka, the learned SDR for the revenue.
The services availed by a manufacturer for outward transportation of final products from the place of removal should be treated as an input service in terms of Rule 2(1)(ii) of the Cenvat Credit Rules, 2004 and thereby enabling the manufacturer to take credit of the service tax paid on the value of such services.
