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2008TIOL1500CESTATBANG
INTHECUSTOMS,EXCISEANDSERVICETAXAPPELLATETRIBUNAL
SOUTHZONALBENCHATBANGALORE
AppealNo.ST/85/2008
ArisingoutofOrderinAppealNo.68/2007STDated:30.09.2007
PassedbytheCommissionerofCentralExcise(AppealsII),Bangalore
DateofDecision:05.08.2008
M/sABSINDIALTD
Vs
COMMISSIONEROFSERVICETAX,BANGALORE
AppellantRepby:ShriPKSahu,Adv.
RespondentRepby:MsSudhaKoka,SDR
CORAM:Dr.SLPeeran,Member(Judicial)
ShriTKJayaraman,Member(Technical)
ST Export of service Assessee is a subsidiary of a Singaporebased company books orders for
sale of goods manufactured by the Singapore company received commission for the same and paid
servicetaxinitiallyLatertheyrealisetheyexportedserviceandfiledrefundclaimRevenuerejects
theclaimassesseearguestheservicewasdeliveredtoSingaporecompanyanditcannotbesaidthat
the service was delivered in India and the service was utilised in Singapore Held, in terms of Rule
3(2) of the export of service rules, 2005, the service rendered is indeed an export on which the
assesseeisnotrequiredtopaytaxAssessee'sappealallowed
FINALORDERNO.942/08/2008
Per:ShriTKJayaraman:
This appeal has been field against OrderinAppeal No. 68/2007 ST dated 30.09.2007 passed by the
CommissionerofCentralExcise(AppealsII),Bangalore.
2. The learned Advocate Shri P K Sahu appeared for the appellant and Ms Sudha Kolka, the learned
SDR,fortheRevenue.
3.Weheardbothsides.
4. The appellant is a company incorporated in India. They have a subsidiary company in Singapore.
The appellant booked orders for the sales of the goods manufactured by the subsidiary situated in
Singapore.Forthispurpose,theyreceivedcertaincommissionandinitiallytheypaidtheServiceTax.
Latertheyrealizedtheastheyhadexportedtheservice,theywouldnotbeliabletopayServiceTax.
Hence, they requested for refund of the amount. The refund was rejected by the Original Authority.
The rejection order has been upheld by the Appellate Authority. Both the Original Authority and
Appellate Authority have held that the service has been rendered in India and it has been utilized,
delivered in India and it is also used in India. The learned Advocate strongly argued that the
understanding of the lower authority is not correct, the services have rightly been delivered abroad
and they have been used by the Singapore Company. They relied on several case laws. They also
stated that it should not be considered that the appellant and the company in Singapore are related,
even though one is a subsidiary of the other, they are separate legal entities. They produced a large

numberofcaselawsonthissubject.TheyalsoreliedonthedecisionofthisTribunalinthecaseofM/s
Blue Star Vs. CCE vide Final Order 489/2008 dated 27.3.2008 = (2008TIOL716CESTATBANG) wherein a
similarsituationwasdealtwith.Thesituationherealsoissimilar.Inthiscase,theIndiancompanyis
the principal and the Singapore Company is a subsidiary. The appellant who is the Indian Company,
booked certain orders for the Singapore Company. It cannot be said that these booking of the order
indicate service being rendered in India. It is not correct. And also because the appellant books the
orders for the Singapore Company, we have to consider that the service is delivered only to the
Singapore Company. The recipient of the service is a Singapore Company. When the recipient of the
serviceisaSingaporeCompany,itcannotbesaidthatserviceisdeliveredinIndiaandthebenefitof
the service is derived only by the recipient company. Because of the booking of the orders, the
Singapore Company gets business. Therefore, the services is also utilized aborad. In terms of Rule
3(2) of the export of Service Rules, 2005 the service rendered is indeed a service, which has been
exported. In such circumstances, the appellant is not required to pay the service tax. There is
absolutelynomeritintheimpugnedorder.Hence,weallowtheappealwithconsequentialrelief.
(PronouncedinopenCourton5Aug2008)
(DISCLAIMER: Though all efforts have been made to reproduce the order correctly but the access and
circulation is subject to the condition that Taxindiaonline are not responsible/liable for any loss or damage
causedtoanyoneduetoanymistake/error/omissions.)

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