Custom, Excise & Service Tax Tribunal Ibm India (P) Ltd vs Commissioner Of Central Tax, Bangaluru ... on 9 July, 2024 ST/429, 548, 549/2009 CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL BANGALORE REGIONAL BENCH COURT NO. 1 Service Tax Appeal No. 429 of 2009 (Arising out of OrderinOriginal No.17/2008 dated 31.12.2008 passed by the Commissioner of Central Excise, BangaloreIII Commissionerate, Bangalore.) M/s. IBM India (P) Ltd. No.12, Subramanya Arcade, Appellant(s) Bannerghatta Road, Bangalore 560 029. VERSUS The Commissioner of Central Excise BangaloreIII Commissionerate Respondent(s) P.B. No.5400, C. R. Building, Queen's Road, Bangalore 560 001. WITH Service Tax Appeal No. 548 of 2009 (Arising out of OrderinOriginal No.15 & 16/2009 dated 27.02.2009 passed by the Commissioner of Service Tax, Bangalore.) M/s. Wipro Ltd. (Infotech Division) Doddakannelli, Sarjapur Road, Electronics City, Hosur Road Bangalore 560 035. Appellant(s) VERSUS The Commissioner of Service Tax No.16/1, 5th Floor, S.P. Complex, Lalbagh Road, Bangalore. Respondent(s) AND Service Tax Appeal No. 549 of 2009 (Arising out of OrderinOriginal No.15 & 16/2009 dated 27.02.2009 passed by the Commissioner of Service Tax, Bangalore.) Page 1 of 57 ST/429, 548, 549/2009 M/s. Wipro Ltd. (Infotech Division) Doddakannelli, Sarjapur Road, Electronics City, Hosur Road Bangalore 560 035. Appellant(s) VERSUS The Commissioner of Service Tax No.16/1, S.P. Complex, 5th Floor, Lalbagh Road, Bangalore. Respondent(s) APPEARANCE: Shri Harish Bindumadhavan, Advocate for the Appellant (M/s. IBM India P. Ltd.) Shri V. Lakshmi Kumaran, Sr. Advocate, S/Shri Ravi Raghavan, Syed Peeran and Ms. Meghna Lal, Advocates for M/s. Wipro Ltd. Shri P. R. V. Ramanan, Special Counsel (AR) for the Respondent HON'BLE MRS. R. BHAGYA DEVI, MEMBER (TECHNICAL) Final Order No. 20542 20544 /2024 DATE OF HEARING: 10.01.2024 DATE OF DECISION: 09.07.2024 PER : R. BHAGYA DEVI These three appeals are filed against respective Ordersin Original passed by the Commissioner of Service Tax, Bangalore. Since common issues are involved in all these appeals, they are taken up together for hearing and disposal. Service Tax Appeal No. 429 of 2009 2. M/s. IBM India Private Limited., Bangalore the appellant are engaged in the activity of development of software for domestic clients as well as overseas clients. They also provide services to their clients under 'Facility Management Services', Page 2 of 57 ST/429, 548, 549/2009 'Maintenance Services' and 'Consulting Services'. The DGCEI after detailed investigations alleged that the appellant had performed the services classifiable under 'Management Consultancy Service' as defined under section 65(65) of the Finance Act 1994 and taxable under Section 65(105)(r) of the Finance Act 1994. Accordingly, a showcause notice No.62/2006 07 dated 21.10.2006 was issued demanding duty amount of Rs.72,25,49,033/ for the period September 2003 to April 2006. The Commissioner on perusal of 12 contract agreements entered by the appellant for providing services to their clients found that the appellant was in fact managing the information technology infrastructure environment of their clients and the operation of the computer systems, which was only a peripheral in nature. He observed that the activities undertaken by the appellant are core activities to manage the office of their clients' organizations and hence, these services fall under the category of 'Management Consultancy Service' and not under 'Business Auxiliary Service' as claimed by the appellant. Accordingly, vide impugned Order No.17/2008 dated 31.12.2008, the Commissioner confirmed service tax demand of Rs.72,25,49,033/ under Section 73 of the Finance Act 1994 along with interest and imposed penalties under Section 76 and 78. Assailing the above order, the appellant is in appeal befor