Sabre Travel Network India P Ltd Vs Commissioner of CGST & Central Excise (CESTAT Mumbai)
In the case of Sabre Travels Network India Pvt Ltd v. Commissioner of CGST & Central Excise, Mumbai Central [Final Order No. A/85779-85783/2020 dated 11 September 2020], the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) ruled on the taxability of certain overseas transactions. The Tribunal observed that while payments were made by the appellant to an overseas entity, the responsibility for repatriation of export proceeds lay with the foreign customer, who authorized M/s Amsco Finance Ltd to perform the task. It was held that M/s Amsco Finance Ltd’s involvement was not a substitute for any contractual responsibility of the appellant, and thus the mediation services were rendered outside India. Under the Place of Provision of Service Rules, 2012, such services performed in Hong Kong are not within the taxable territory of India, and consequently, the demand for service tax post 1 July 2012 was unsustainable. Further, the Tribunal referred to M/s SKM Egg Products Export and Dileep Industries Pvt Ltd where it was held that charges deducted by foreign banks for remittance of export sale proceeds cannot be subject to service tax at the hands of exporters. Since the appellants never directly engaged foreign banks and services were rendered to Indian banks like SBI, the levy of service tax on exporters was found to be untenable. The CESTAT concluded by setting aside all impugned orders and allowing the appeals with consequential relief as per law.
FULL TEXT OF THE CESTAT MUMBAI ORDER
