BONFIGLIOLI TRANSMISSIONS P. Vs. COMMISSIONER OF C. EX.

JUDGEMENT

(1.) The appellants are manufacturing gear boxes and gear motors in India using technical know -how obtained from a foreign collaborator stationed in Italy. They paid a consideration for this service to the Italian Company. The department raised demand of Service Tax on this amount treating the above service as "Engineering Consultancy Service" within the meaning of Section 65 of the Finance Act, 1994. This demand was contested. However, it was confirmed by the original authority and sustained by the first appellate authority. These authorities have imposed penalties also on the assessee. The present application seeks waiver of pre -deposit and stay of recovery in respect of the amounts of Service Tax and penalties.

(2.) Learned Counsel for the appellants claims prima facie case on the strength of case law. He has cited mainly the following decisions of the Tribunal:

(3.) After considering the submissions, I find that transfer of technology by foreign Company to India against payment of royalty was held not to be a taxable service under Section 65 of the Finance Act, 1994. Appellants do have a prima facie case. Hence there will be waiver of pre -deposit and stay of recovery in respect of the amounts of tax and penalties.