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Business Auxiliary service — Computerisation of energy billing for Rajasthan State Electricity Board — Assessee feeding data provided by clients in computer network system with the software created specially for the client — No service undertaken on behalf of client as having no contact with customers — Work using custom-made software classifiable as Information Technology service.
Facts:
The appellants were ordered by Rajasthan State Electricity Board (RSEB) for computerisation of energy billing and related MIS, relevant formats, performas and information, for which the appellant developed a software only for RSEB. SCN was issued alleging that the services rendered by them amounted to BAS and thus service tax was payable and penalties were leviable. On appeal by the party, the Commissioner concluded that service rendered were in the nature of information technology service which is not included under the category of business service. Relying on the decision in the case of Dataware Computers & Ors. v. CCE & CST (Appeals), Guntur 2008 (87) RLT 325 (CESTAT-Bang.), the appellants contended that they have merely undertaken computer-enabled service of data processing and generation of reports and bills which came under Information Technologies service and not under BAS.
Held:
It was observed that the assessee had not undertaken any service on behalf of their clients as they did not have contract with the customer of their clients and were not issuing bills directly to the customers of their clients. The work of data processing using custom-made software deserves to be considered as Information Technology services. Accordingly, the appeal was allowed and penalty set aside.
