Page 52 - GSTL_2nd July 2020 _Vol 38_Part 1

J26 GST LAW TIMES [ Vol. 38
(1) Valuation (Service Tax) — Reimbursable operating
expenses on marketing of products of foreign seller
in India whether excludable under Business
Auxiliary Service?
(2) Export of services — Place of Provision of Service
under Business Auxiliary Service?
The Supreme Court Bench comprising Hon’ble Mr. Justice Arun Mishra,
Hon’ble Mr. Justice S. Abdul Nazeer and Hon’ble Ms. Justice Indira Banerjee on
2-6-2020 after condoning the delay issued notice in the Civil Appeal Diary No.
5151 of 2020 filed by Commissioner of Service Tax-VII, Mumbai against the
CESTAT Final Order No. A/86306/2019-WZB, dated 1-5-2019 as reported in
2019 (31) G.S.T.L. 83 (Tri. - Mumbai) (Commissioner v. Abbott Healthcare Pvt. Ltd.).
While issuing the notice, the Supreme Court passed the following order :
“Delay condoned.
Issue notice.
Tag with C.A. Nos. 8045-8046/2018.”
The Appellate Tribunal in its impugned order had held that for selling
products in India, assessee procuring goods from foreign subsidiary company,
required to explore and develop market for said goods in India. To develop and
expand market for these products in India, certain expenses incurred and such
operating expenses, reimbursed by foreign supplier. In view of settled law, such
reimbursable expenses incurred cannot be included in taxable value of services
rendered.
It was further held that services provided by assessee are classifiable un-
der category of “Business Auxiliary Services” and fall in Category-III services
covered by Rule 3(1)(iii) of Export of Services Rules, 2005. Thus, for period prior
to 27-2-2010, C.B.E. & C. Circular No. 111/05/2009-S.T., dated 24-2-2009 was ap-
plicable and service amounted to export of service as recipient of service was
located abroad and payment for services was received in foreign exchange. Place
of provision of service was abroad and not India.
REPRESENTED BY : Mr. A.N.S. Nadkarni, ASG, B. Krishna Prasad,
AOR and Ms. Binu Tamta, Advcoate, for the
Petitioner.
Ms. Vanita Bhargava, AOR, Mr. Ajay Bhargava,
Mr. Sanjeev Sachdeva and Ms. Shweta Kabra,
Advocates, for the Respondent.

Input Tax Credit — Transitional credit’s admissibility on
failure to file Form GST TRAN-1 within extended
time due to technical glitch in GSTN common portal
The Supreme Court Bench comprising Hon’ble Mr. Justice A.M.
Khanwilkar, Hon’ble Mr. Justice Dinesh Maheshwari and Hon’ble Mr. Justice
Sanjiv Khanna on 3-6-2020 after condoning the delay dismissed the Special
Leave Petition (Civil) Diary No. 7374 of 2020 filed by Union of India against the
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