Service tax on import od service

This query is : Resolved

Harshal (Querist)
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26 September 2016 Dear All
We have imported software , they are also charging Maintenance charges for the same,
whether Service tax will be applicable on both under RCM or Not?

Harshal konde

Sunil Kumar

Sunil Kumar (Expert)
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26 September 2016 As far as maintenace is concern RCM is applicable.

But for software, can u please explain whether software is customised or Pre package.

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Harshal

Harshal (Querist)
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26 September 2016 yes we are ordering both customize as well as Pre package

Sunil Kumar

Sunil Kumar (Expert)
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26 September 2016 Following is the definition included under section 66E

Site Development of software, Development, design, programming, customization, adaptation, up gradation, enhancement, implementation of information technology software has been included as a information technology software.

Therefore customised software import are called to be import of service. Whereas It is a settled position of law that pre-packaged or canned software which is put on a media is in the nature of goods [Supreme Court judgment in case of Tata Consultancy Services vs State of Andhra Pradesh [2002(178) ELT 22(SC) refers]. Sale of pre-packaged or canned software is, therefore, in the nature of sale of goods and is not covered in this entry.

Thus no service tax on pre pacakage software.

Harshal

Harshal (Querist)
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26 September 2016 in simple if it is customize RCM is applicable and If it is Pre packed RCM not applicable.

Harshal

Harshal (Querist)
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26 September 2016 Thanks for your quick response I personally appreciate you help.

Sunil Kumar

Sunil Kumar (Expert)
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26 September 2016 Most Welcome Harshl :-D

Harshal

Harshal (Querist)
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26 September 2016 but TDS is applicable on Pre pack software ?