CCE Vs. MRF LTD.

JUDGEMENT

(1.) This appeal of the Revenue is against dropping of a demand of Service Tax on the respondents. The original authority had demanded Rs. 53,075/ - from the respondents towards Service Tax on the total charges paid by them to a foreign company, namely, M/s. Tyreign Inc., USA, on the basis of a finding that they had paid such charges for "Consulting Engineer Service" as defined under Clause (31) of Section 65 of the Finance Act, 1994. It also imposed penalties on the respondents under Sections 76 to 78 of the said Act. The decision of the original authority was set aside by the Commissioner (Appeals) in an appeal filed by the assessee. It was held by ld. Commissioner (Appeals) that the service received by the assessee from the foreign company was not "Consulting Engineer Service' but in the nature of "Scientific and Technical Consultancy Service", which had become a taxable service with effect from 16.7.2001 only. The respondents had received the service from the foreign company and paid for the same prior to 16.7.2001. Therefore, ld. Commissioner (Appeals) set aside the demand of Service Tax. The present appeal is against the decision of the lower appellate authority.

(2.) SDR reiterated the grounds of this appeal. The respondent's Counsel argued in defence of the impugned order.

(3.) In have carefully considered the submissions. According to the appellant, the following services were rendered to the respondents by M/s Tyreign Inc., USA,: