SPI Technologies India Pvt. Ltd. Vs Commissioner of GST & Central Excise (CESTAT Chennai)
The appeal was filed by SPI Technologies India Pvt. Ltd. against the Order-in-Appeal dated 23.09.2015 passed by the Commissioner of Service Tax (Appeals-I), Chennai, which had upheld the confirmation of service tax demand, interest and penalties.
Material Facts and Procedural Background
The appellant, a 100% Export Oriented Unit registered under the Software Technology Park of India, was engaged in providing Business Auxiliary Service. During an audit, the Department noticed that during the period 2004-05 to 2006-07, the appellant had subcontracted data capturing and data processing of books and journals to its wholly owned subsidiary, M/s Apex Abstracting & Editing Services (P) Ltd. M/s Apex received data processing charges from the appellant for carrying out these activities.
The Department considered the activities undertaken by M/s Apex to be classifiable under Business Auxiliary Service. In view of the Scheme of Amalgamation approved by the Madras High Court on 20.04.2007, the appellant was considered liable to discharge service tax on behalf of M/s Apex. A show cause notice dated 24.07.2009 was issued proposing recovery of service tax under the proviso to Section 73(1) of the Finance Act, 1994. The Original Authority confirmed a demand of ₹37,54,982 along with interest and imposed penalties under Sections 76, 77 and 78. The Commissioner (Appeals) rejected the appellant’s appeal, leading to the present appeal before the Tribunal.
