MetricStream Infotech (India) Pvt. Ltd. Vs Principal Commissioner of Customs (CESTAT Delhi)
CESTAT Delhi held that duty recovery under section 28AAA of the Customs Act justifiable since IT services fraudulently mis-declared as ‘Management Consulting Services’ to obtain benefits under Service Exports from India Scheme (SEIS). Accordingly, company appeal is dismissed.
Facts- The appellant is a wholly owned subsidiary of M/s. Metric Stream, Inc, USA and is engaged in the business of providing ‘Information Technology Software Services’/’IT Enabled Services’ related to ‘Computer Programming’, ‘Consultancy and related Services’ in terms of the Master Service Agreement with its parent company. The appellant had filed an application under Service Export from Indian Scheme with respect to „Marketing Support Services‟ provided to the parent company. Based on the investigations by DRI, it appeared that the IT services provided by the appellant were not eligible for SEIS benefit in terms of Trade Notice No.4/2018.
Challenge in the present appeals is to the confirmation of the show cause notice issued under the provisions of Section 28AAA of the Customs Act, 1962 for having fraudulently obtained three Service Export from India Scrips by falsely declaring the services exported as „Management Consulting Services‟ under Central Product Classification 86503 though in fact, the services rendered were „Information Technology and IT – Enabled Services‟ classifiable under Division 84 of the UN–CPC.
