HERO CYCLES LTD. Vs. COMMISSIONER OF CENTRAL EXCISE

JUDGEMENT

(1.) APPLICANT filed this application for waiver of pre -deposit of amount of service tax of Rs. 27,24,000/ - and penalties. The demand was confirmed on the ground that applicant is recipient of intellectual property services.

(2.) CONTENTION of applicant is that in the show cause notice, demand is on the ground that applicant received intellectual property service as well as consulting engineering service. The demand in respect of consulting engineering service is dropped and some portion of the present demand is also dropped on the ground of limitation.

(3.) CONTENTION of revenue is that as per the agreement, the National Bicycle Industries, Japan is engaged in the production and sale of bicycle and parts. The applicant entered into contract to receive technical information and knowhow for production of their cycles and parts thereof. As per the agreement, applicants are receiving part designs, frame designs, parts assembled designs etc. This clearly shows that the intellectual property right in respect of the designs of parts is being transferred to the applicant, therefore, is liable for service tax.