Page 157 - GSTL_2nd July 2020 _Vol 38_Part 1

2020 ] HINDUSTAN AERONAUTICS LTD. v. COMMISSIONER OF S.T., BANGALORE-I 75
2020 (38) G.S.T.L. 75 (Tri. - Bang.)

IN THE CESTAT, SOUTH ZONAL BENCH, BANGALORE
[COURT NO. II]
S/Shri S.S. Garg, Member (J) and P. Anjani Kumar, Member (T)
HINDUSTAN AERONAUTICS LTD.
Versus
COMMISSIONER OF S.T., BANGALORE-I
Final Order No. A/20253/2020, dated 27-2-2020 in Application No.
ST/MISC/665/2012 in Appeal No. ST/210/2012-DB
Intellectual Property services - Transfer of technology - Service Tax
liability under Reverse Charge Mechanism - Services rendered by foreign
company in pursuance of agreement for transfer of technology and technical
assistance for production of aircraft - Such technical know-how, design, copy
right, etc., not being patented in India in view of the clarification given by the
Board, the services received by appellants from foreign company not in the
nature of Intellectual Property services as defined under Section 2(55b) of Fi-
nance Act, 1994 - Service Tax not attracted under impugned head on reverse
charge basis. [paras 4, 5]
Appeal allowed
CASE CITED
Commissioner v. Hindustan Aeronautics Ltd.
— 2015 (40) S.T.R. 289 (Tribunal) — Relied on ....................................................................... [Paras 2, 4]
DEPARTMENTAL CLARIFICATION CITED
C.B.E. & C. Circular No. 80/2004-S.T., dated 17-9-2004 ................................................................ [Paras 2, 4]
REPRESENTED BY : Shri Indranil Banerjee, CA, for the Appellant.
Shri S. Devarajan, Dy. Commissioner (AR), for the
Respondent.
[Order per : P. Anjani Kumar, Member (T)]. - Brief issue involved in this
appeal is that the appellants-M/s. Hindustan Aeronautics Limited are engaged
in the manufacture and overhaul of aircraft engines and parts; they are registered
under the taxable service category of ‘Management, Maintenance or Repair Ser-
vice’. The appellants have entered into an agreement with Rolls Royce Turbome-
ca Limited, U.K. as part of Inter-governmental agreement between Govt. of India
and Govt. of United Kingdom. In accordance with the contract, the appellants
have made payments towards the transfer of technology, design, drawing, tech-
nical know-how, intangible assets etc. to the overseas company. Alleging that the
payments made by the appellants to the overseas entity are in respect of a service
received by them under the head “Intellectual Property Rights” the Department
has issued show-cause notice dated 19-10-2010 to the appellant covering the pe-
riod 2004-05 to 2008-09 demanding a service tax of Rs. 3,87,76,230/- (Rupees
Three Crore Eighty Seven Lakhs Seventy Six Thousand Two Hundred and Thirty
only). The said show-cause notice was adjudicated by the impugned order i.e.
169/2011, dated 24-10-2011 wherein service tax of Rs. 2,87,56,271/- (Rupees Two
Crore Eighty Seven Lakhs Fifty Six Thousand Two Hundred and Seventy One
only) was confirmed.
GST LAW TIMES  2nd July 2020  157