Consortium Clinical Research Pvt. Ltd. Vs Commissioner of GST & Central Excise (CESTAT Chennai)
Summary: CESTAT Chennai allowed Service Tax Appeal No. 41928 of 2016 and the connected Service Tax Appeal No. 41929 of 2016 filed by M/s. Consortium Clinical Research Pvt. Ltd. (“CCRP”), setting aside the common adjudication order dated 30.06.2016 and the entire Service Tax demand of Rs. 65,25,515/- together with interest and penalties. The appeals arose from Orders-in-Original Nos. CBE/ST/23 & 24/2016-Commr. The first show cause notice dated 08.04.2015 proposed Rs. 60,78,676/- on Technical Testing & Analysis Service for 01.10.2009 to 31.03.2014 and Rs. 2,19,395/- on Commercial Coaching & Training for the same period. A further notice dated 11.09.2015 proposed Rs. 2,27,444/- on Technical Testing & Analysis Service for 01.04.2014 to 31.07.2014.
CCRP is a Clinical Research Organisation based at Coimbatore providing contract research services to pharmaceutical, biotechnology and medical device industries. The Department had sought particulars of CCRP’s clinical research activities as early as 2010, and CCRP had furnished the requested information. During the later investigation, it supplied audited financial statements, Form 26AS, details of activities, its clinical research workflow, agreements with Sponsors and sample investigator agreements. CCRP explained that, under the regulatory scheme administered by the Drugs Controller General of India (DCGI), permission for a clinical trial is granted to the drug Sponsor and that a CRO does not obtain a separate DCGI approval in its own name. It relied on Notification No. 11/2007-ST dated 01.03.2007 and, from 01.07.2012, Entry 7 of Notification No. 25/2012-ST dated 20.06.2012.
