CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL BANGALORE REGIONAL BENCH - COURT NO. 1 Service Tax Misc. Application (Addl. Submission)

No.20457 of 2025 in Service Tax Appeal No. 2264 of 2012 (Arising out of Order-in-Original No.14/2012 dated 18.05.2012 passed by the Commissioner of Central Excise, Bangalore – III Commissionerate, Bangalore.)

Samsung (India) Software Operations Private Limited Appellant(s)

66/1, Bagmane Techpark, CV Raman Nagar, Byrasandra, Bangalore – 560 093.

VERSUS The Commissioner of Central Excise Bangalore-III Commissionerate, C.R. Building, Queen’s Road, Respondent(s)

Bangalore – 560 001.

APPEARANCE:

Mr. Sumeet Khurana, Chartered Accountant for the Appellant.

Mr. M. A. Jithendra, Asst. Commissioner (AR) for the Respondent.

CORAM: HON'BLE DR. D.M. MISRA, MEMBER (JUDICIAL)

HON'BLE MRS. R. BHAGYA DEVI, MEMBER (TECHNICAL)

FINAL ORDER NO. 20303 / 2026 DATE OF HEARING: 14.10.2025 DATE OF DECISION: 13.03.2026 PER: R. BHAGYA DEVI This appeal is filed by. M/s Samsung (India) Software Operational Pvt. Ltd. against Order-in-Original No. 14/2012 dated 18.05.2012 passed by Commissioner of Central Excise Bangalore-III, Commissionerate.

2. Appellant has also moved a miscellaneous application for inclusion of additional submissions in their grounds of appeal, which is accepted and taken on record. The Miscellaneous Application is allowed and appeal is taken up for hearing and disposal.

3. Briefly the facts are that the appellant is 100% Export Oriented Unit (EOU) and registered under various categories of services for which service tax is being discharged. On investigation, the Revenue observed that the appellant was receiving Information Technology Software Service (ITSS) from their foreign companies but did not discharge service tax on the same which was paid later voluntarily and show-cause was issued to confirm the same. The Commissioner in the impugned order raised three issues relating to double entry, the second issue is whether software imported in Compact Disc (CD) is leviable to service tax and third issue is whether the appellant is liable to pay service tax on the software purchased from Indian vendors on high seas sale. The first issue was dropped and the Commissioner in the impugned order confirms service tax on the CD’s as well as on the software purchased on high seas sale basis by invoking the extended period of limitation. Aggrieved by this, the appellant is in appeal before us.

4. The Learned Chartered Accountant (CA) submitted that the appellant is engaged in the business of rendering Research and Development in relation to Information Technology Software. At the outset, the appellant submits that the impugned order fails to appropriate the service tax amount of Rs.6,29,862/- already paid by the appellant along with interest against import of software electronically from Klockwork. Also, it is stated that an amount of Rs.75,479/- paid by them against the dues has not been appropriated.

4.1 With regard to purchase of software on High Sea sales basis, it is submitted that there is no statutory provision under the Finance Act which recognizes High Sea sales transactions. The appellant had purchased the software from an Indian vendor on high seas sale basis, hence, the question of discharging service tax under Section 66A Of the Finance Act 1994 does not arise. As per Section 66 read with Import of Service Rules, the following conditions have to be satisfied viz., (i) provider of services based outside India; (ii) Recipient of service is based in India and (iii) Service qualifies as import under Import Service Rules. In the instant case, the supplier being the Indian vendor, the first condition is not satisfied, hence, the appellant is not liable to service tax.

4.2 With regard to service tax on import of software in Compact Disc (CD) referring to the definition of software, he submitted that Compact Disc cannot be considered as software in view of the Hon’ble Supreme Court in the case of Tata Consultancy Services v