CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL CHENNAI REGIONAL BENCH – COURT No. I Service Tax Appeal Nos. 41056 to 41057 of 2015 (Arising out of Orders-in-Original Nos. 03-08/2015 dated 27.02.2015 passed by Commissioner of Service Tax-III, Newry Towers, 2054/1, II Avenue, 12^th Main Road, Anna Nagar, Chennai –

600 040)

M/s. Sutherland Global Services Private Limited ...Appellant No. 45A, Velachery Main Road, Velachery, Chennai – 600 042.

Versus Commissioner of GST and Central Excise ...Respondent Chennai III Commissionerate, Newry Towers, No. 2054/1, II Avenue, 12^th Main Road, Anna Nagar, Chennai – 600 040.

APPEARANCE:

For the Appellant : Shri Raghav Rajeev, Advocate For the Respondent : Shri N. Satyanarayana, Authorised Representative CORAM:

HON’BLE MR. VASA SESHAGIRI RAO, MEMBER (TECHNICAL)

HON’BLE MR. AJAYAN T.V., MEMBER (JUDICIAL)

FINAL ORDER Nos. 40678-40679 / 2025 DATE OF HEARING : 23.01.2025 DATE OF DECISION : 30.06.2025 Per Mr. VASA SESHAGIRI RAO Service Tax Appeal Nos. 41056 to 41057 of 2015 filed by M/s. Sutherland Global Services Private Limited (hereinafter referred to as Appellant) are directed against the impugned Orders-in-Original Nos. 03-08/2015 dated

27.02.2015 passed by the Commissioner of Service Tax III, Chennai whereby the Ld. Commissioner has confirmed the demand of service tax of Rs.2,07,33,703/- under Section 73(1) of Finance Act 1994 along with interest under Section 75 of the Finance Act, 1994, imposed equal penalty under Section 78 and also the penalty of Rs. 200 per day or 2% of such tax per month, whichever is higher, subject to the maximum of the amount of service tax payable under Section 76 of the Finance Act, 1994 in respect of the demand made.

2.1 Brief facts of the case are that M/s. Sutherland Global Services Pvt. Ltd. are one of the subsidiary companies of Sutherland Global Services Inc USA engaged in providing IT enabled services, Technical Help Centre service, call centre service on behalf of clients viz., Microsoft, HP etc., whose customers are located outside India.

2.2 It appears that the Appellant was paying certain amounts in foreign currency under the head "Other expenses" including salary to the trainers from foreign companies. But for availment of connectivity services and trainers / coaches, the call centre service and the technical help desk service could not have taken place and hence it was alleged that the Appellant is liable to pay Service tax on the aforesaid charges under the category of "Business Auxiliary Service" w.e.f. 01.07.2003 in terms of Section 66A of the Finance Act, 1994 read with Rule 2(1) (d)(iv) of Service Tax Rules, 1994. It appears that the above facts have been suppressed by the Appellant intentionally so as to evade payment of appropriate service tax and the same would not have come to light but for the audit carried out by the Departmental Officers.

2.3 On the basis of audit conducted, the Appellant was issued with the following Show Cause Notices proposing demand of Service tax and imposition of penalties as detailed below: -

All the SCN’s issued above involve issue of non-payment of service Tax on a) Telecommunication connectivity services received and b) Payment of certain amount in foreign currency under the head "Other expenses" including salary to trainers from foreign companies.

2.4 After the due process of the adjudication, the Commissioner of Central Excise & Service Tax III, Chennai vide Order-in-Original No. CHN-SVTAX-003-COM- 03 to 08/ 2014-15 dated 27.02.2015 has dropped the demand arising out of the issue of connectivity charges (Telecommunication Service) and confirmed the demand of service tax on the other expenses as follows: -

Thus, out of 6 Show Cause Notices / Statement of Demands, proceedings in respect of demands listed at from S.Nos. 3 to

6 have been dropped.

2.5 Aggrieved by the confirmation of demand as stated above in respect of SCNs issued for 2003-2004 to 2007-2008 listed above at Sl.Nos. 1 and for 2008-2009 as listed at Sl.No. 2, dema