No Service Tax on Business Exhibition Service received When Whole Services were performed outside India: CESTAT [Read Order]

The Ahmedabad bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has held that service tax cannot be levied on Business Exhibition Service received by the assessee when the services were performed outside India.

The appellant, Rama Cylinders Pvt. Ltd, submits that the service was provided in countries like Pakistan, Egypt, Bangkok and Ukraine by the service provider of the said respective countries. He submits that the service provider had provided the said service namely, Business Exhibition Service outside India only and the appellant had received the said service then and there only i.e. outside India. Even the service was not provided partly in India, therefore, the service is not liable to tax in the hands of the appellant. He submits that even the service is not covered as import of service in terms of Taxation of Service (Provided from outside India and received in India) Rules, 2006.

Mr. Ramesh Nair, Member (Judicial) and Mr. Raju, Member (Technical) observed that in the present case the service provided by the overseas service provider is Business Exhibition Service.

“The service provider i.e.organiser of exhibitions are located in the countries such as Pakistan, Egypt, Bangkok and Ukraine and no any part of the service was provided in India. Entire service was provided outside India only, therefore, the locations of service are outside India. In such case, service tax cannot be levied in India. Even as per Rule 3 of Sub Rule (II) of Taxation of Service (Provided from Outside India and Received in India) Rules 2006, a service can be taxable in the hand of the recipient of the service in India only when the part of the service is performed in India. In the present case, admittedly the whole of the service was provided outside India and received outside India, therefore, even in terms of the said rule, the service tax is not leviable on the Business Exhibition Service received by the appellant which was performed outside India hence not taxable in the hands of the appellant. Accordingly, the impugned order is set aside and appeal is allowed,” the Tribunal said.

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