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CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL NEW DELHI

PRINCIPAL BENCH-COURT NO. 1

SERVICE TAX APPEAL NO. 50259 OF 2021 [Arising Out Of Order In Original No. 12/2020-St Dated 15.06.2020 Passed By

The Additional Director General (Adjudication), New Delhi]

LI & FUNG INDIA PRIVATE LIMITED …….APPELLANT Tower-B, S.P. Infocity, 243, Udyog Vihar

Phase I, Gurugram, Haryana-122016

Vs.

COMMISSIONER, CGST-DELHI ……RESPONDENT

Appearance:

Shri Tarun Gulati, Senior Advocate, Shri Deepak Suneja, Chartered Accountant, Shri Jayant Sharma and Shri Kumar Sambhav, Advocates

for the Appellant Shri C. Dhanshekharan, Special Counsel for the Respondent

CORAM:

HON’BLE MR. JUSTICE DILIP GUPTA, PRESIDENT HON’BLE MR. P.V.SUBBA RAO, MEMBER ( TECHNICAL )

FINAL ORDER NO. 50625 /2026 DATE OF HEARING : 11/02/2026

DATE OF DECISION : 27/03/2026

P.V. SUBBA RAO

1. M/s Li & Fung, India Private Limited¹ filed this appeal to assail the order dated 15.06.2020² passed by the Additional Director General³, Director General of GST Intelligence⁴ in which he decided the proposals made in the Show Cause Notice dated

1 Appellant

2 Impugned order

3 ADG

4 DGGST

2 ST/50259/2021

11.10.2018⁵ issued to the appellant by the ADG covering the

period from October 2015 to June, 2017.

2. We have heard Shri Tarun Gulati, learned senior counsel for the appellant and Shri C. Dhanasekaran, learned special counsel

for the Revenue and perused the records.

3. The appellant, a subsidiary of Li & Fung Private Limited, Hong Kong⁶, had provided certain services to Li & Fung, Hong Kong and received consideration for the services. For this purpose it had entered into an agreement dated 13.02.2007 with Li & Fung, Hong Kong. The case of the Revenue is that the services rendered by the appellant to Li & Fung, Hong Kong were intermediary services and hence the place of provision of these services was India in terms of Rule 9 of the Place of Provision of Services Rules, 2012⁷. The case of the appellant, on the other hand that these were not intermediary services but were in the nature of business support services to Li & Fung, Hong Kong and, therefore, as per Rule 3 of POPS Rules the location of the service recipient, namely, Hong Kong was the place of provision of service. Therefore, according to the appellant, it was a case of export of services and appellant was not required to pay any

service tax on these services and hence did not pay service tax.

4. Before discussing the facts of the case, it must be pointed out that service tax is levied under Chapter V of the Finance Act,

5 SCN

6 Li & Fung, Hong Kong

7 POPS Rules

3 ST/50259/2021

1994⁸. From 1994 to 01.07.2012, service tax could be levied under section 66 of the Finance Act only on taxable services i.e., services defined in various clauses of section 65 (105) of the Finance Act. With effect from 01.07.2012, the Finance Act was amended and all services other than those in the negative list were made exigible to service tax. Thus, service tax had to be paid from 01.07.2012 on any service rendered unless it was covered by the negative list or it was otherwise exempted. The definition of taxable service as applicable to the period after

1.07.2012 in section 65B (51) reads as follows:

SECTION 65B. Interpretations.— In this Chapter, unless the context otherwise requires,—

(51) “taxable service” means any service on which service tax is leviable under section 66B;

5. Section 66B reads as follows:

SECTION 66B. Charge of service tax on and after Finance Act, 2012.— There shall be levied a tax (hereinafter referred to as the service tax) at the rate of fourteen percent. on the value of all services, other than those services specified in the negative list, provided or agreed to be provided in the taxable territory by one person to another and collected in such manner as may be

prescribed.

6. Thus, after 2012, service tax could be levied only if the services were rendered in the taxable territory, which, as per section 65B (52) means “the territory to which the p