ST - Appellant, an IITian
rendered consultancy services in respect of metal development and
received professional fees - such service cannot be termed as Market
Research Agency Service: CESTAT
MUMBAI
: A SCN was issued to the appellant demanding Service Tax of
Rs.45,000/- on the ground that the appellant is engaged in conducting
marketing research in relation to steel products, hence are covered
under Market Research Agency service.
As the lower authorities confirmed the demand and imposed penalties, the appellant is before the CESTAT.
On
the last date of hearing, the Proprietor of the appellant firm was
directed by the Bench to produce evidence in respect of compensation
received from M/s Kalyani Carpenter Special Steels Ltd., Pune . In
pursuance to the direction, the appellant produced a copy of the bank
voucher issued. The appellant submitted that being an IIT Engineer, the
client had engaged him for consultancy in respect of metal development
and payments were made as professional fees. It was also submitted that
his job was of an industrial sales man and he carries brochures of the
company to various prospective buyers, gives information about products
and facilities available and requested them to try out company's
product. Inasmuch as since the appellant had not provided any market
research agency service, no ST liability arises.
The Revenue representative submitted that the lower authorities were correct.
The Bench observed -
"7.
We find that in reply to the Show Cause Notice the appellant
specifically gave details of his activities which is not in respect of
market research agency service. The payment made by M/s Kalyani
Carpenter also in respect of professional fee in respect of metal
development. In view of this, we find merit in the contention of the
appellant that the appellant had not provided any taxable service in
respect of market research agency…."
So, the order of the lower authority was set aside and the appeal was allowed.