2018 (6) TMI 796 – CESTAT MUMBAI – TMI – Refund claim – Services rendered outside India – Place of Provision of Services Rules – rejection on the ground that since M/s Holtech International has taken registration on 02/07/2015 at Wakad, Pune, hence as per definition of service recipient in Rule 2 (i) of PPS Rules, the location of service recipient is premises for which such registration has been obtained i.e India – Rule 6 A of Service Tax Rules – Held that:- The office of M/s Holtech International situated in USA is different establishment from its project office in India – In the present case it is the US establishment of M/s Holtech International, USA who has availed the services from the Appellant and therefore the services rendered by Appellant would clearly fall under the category of Export of Service in terms of Rule 6 A of Service Tax Rules, thereby making them eligible for refund claimed by them – appeal allowed – decided in favor of appellant. – Appeal No. ST/85367,85369,853
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Pune, hence as per definition of service recipient in Rule 2 (i) of PPS Rules, the location of service recipient is premises for which such registration has been obtained i.e India. As both service provider and service recipient are located in India as per Rule 8 of PPS Rules, 2012, the place of provision of Services shall be the location of service recipient of service. The condition (b) and (d) of Rule 6A of STA Rules has not been satisfied and therefore the impugned service do not qualify as export of service. The Appellant filed reply to the said objection contending that M/s Holtech International is having Project office in India who is rendering services solely to NTPC for their 2*800MW Lara Super Thermal Project received from BGR Energy Systems Ltd. They have not rendered any services directly or indirectly related to M/s NTPC contract. The adjudicating authority rejected the claims on the ground that w.e.f 07.05.2014 M/s Holtech international has opened branch office in India a
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e therefore their service qualify as export and are entitled for refund. He submits that as per the law settled in case of Paul Merchant Ltd. (2013 (36) STR 257), Microsoft Corporation India Pvt. Ltd. (2014(36) STR 766), Verizon Communication India Pvt. Ltd. (2018 (8) STR GSTL 32) (Del), SGS India Pvt. Ltd. (2014(34) STR 554) (Bom.), the recipient of service is the person who has contracted to avail the services and who is obliged to make payment for the services. In the present case admittedly the person who is contracted for service is Holtech international USA and the payment is also received from them in foreign exchange. The Appellant thus fulfills the requirement of Rule 6A of the Service Tax Rules, 1994 and therefore their services qualify as export of service as claimed by them and they are eligible for the refund. The registration of Holtech International USA project office in India with the service tax department shall not have any bearing on the services provided by Appellan
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) of the Finance Act, 1994 an establishment of a person in the taxable territory and any of his other establishment in a nontaxable territory shall be treated as establishment of distinct person. The establishment of Holtec International in India and USA shall be treated as distinct persons. The Appellant did not provide any service in the project office in India which has been confirmed by an independent chartered Accountant s Certificate therefore denial of export status to the appellant on the basis of above contention is incorrect. He draws analogy with Section 66A of Finance act to submit that where the provider of service has his establishment in two countries, the country where the establishment of the service provider is directly concerned with the provision of service is located, shall be treated as the country from which the service is provided. Thus in present case the establishment located in USA who has contracted for the service and not the project office will be consider
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ervice to M/s Holtec International USA and the consideration towards the same has been received in Foreign Exchange. Further the office of M/s Holtec International USA in Wakad, Pune was only for the purpose of providing services to the customer – BGR Energy Systems Ltd who had placed the purchase order dt. 15.10.2013 on Holtech International USA. Such company opened office at Pune had no connection with the services rendered by the Appellant. The instant refund claims were filed on account of services rendered outside India and the claim has been filed in terms of Rule 5 of Cenvat Credit Rules, 2004. In terms of provisions of Rule 6A (1) of the Service Tax Rules, 1994 the services are treated as export of service when : – (a) the provider of service is located in the taxable territory, (b) the recipient of service is located outside India, (c) the service is not a service specified in the section 66D of the Act, (d) the place of provision of the service is outside India, (e) the payme
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located outside India. The Indian Project office of M/s Holtech International Ltd, USA was not at all concerned with such services. Further in terms of Explanation 3 to Section 65B (44) different establishment located in non taxable territory and taxable territory are to be treated as establishment of different persons. It reads as under : service means any activity carried out by a person for another for consideration, and includes a declared service, but shall not include- Explanation 3. – For the purposes of this Chapter,- (a) an unincorporated association or a body of persons, as the case may be, and a member thereof shall be treated as distinct persons; (b) an establishment of a person in the taxable territory and any of his other establishment in a non-taxable territory shall be treated as establishments of distinct persons. Explanation 4. – A person carrying on a business through a branch or agency or representational office in any territory shall be treated as having an establi
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