Packaged software

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virendra parwal (Querist)

31 December 2010 Through Notification No. 53/2010 Service Tax CBEC has provided conditional exemption from service tax to the right to use packaged/canned software. Prior December 21, 2010 Notification No. 2/2010 and 17/2010 was present for similar kind of exemption. The conditions for availing exemption from Service tax is as below:

(a) In respect of software manufactured in India - The manufacturer, duplicator, or the person holding the copyright to software has paid the appropriate duties of excise on the entire amount received from the buyer (b) In case of software Imported into India - The importer has paid the appropriate duties of customs on the entire amount paid by him.

Query:- In case the manufacturere covered under SSI and not making actual payment of Excise duty would get benefit of exemtion in service tax. (Mind the word used is appropriate duty of excise has been paid)

Guest

Guest (Expert)

03 January 2011 Threshold limit for Central excise and service tax are different, hence it is quite possible that SSI unit is not required to pay duty on a turnover of Rs 1.5 crores whereas for service tax it is only Rs 10 Lakh.
When we say "appropriate duty of excise has been paid", it conveys an impression that duty should have been paid and Nil duty is not equivalent to payment of appropriate duty. Hence, it appears that SSI unit shall be liable to pay Service tax. However, it is definitely an arguable case.

virendra parwal

virendra parwal (Querist)

10 January 2011 In my view SSI unit (having turnover upto 1.5 crore) is neither liable to pay excise duty nor service tax. pl. examine again.

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