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Directi internet solutions pvt ltd vERSUS commissioner of service tax - 2014 (8) tmi 591 - cestat mumbai - sERVICE tAX
August, 20th 2014

We find that the agreement is of a nature of principal to principal basis and resellers cannot be considered as franchisee or associate franchisor of ICANN. 43. In fact, we have already held earlier that appellant cannot be considered as a franchisee of ICANN and therefore resellers cannot considered as franchisee of the associate franchisor. In view of above position, in our view the Revenue's contention that the resellers are providing the franchisee services of the ICANN does not hold water.

In view of the above analysis we do not find any strength in the second demand notices also. Accordingly we hold no service tax is leviable under the franchise service and hence demand and penalties are not sustainable. 44. We also note that the appellant has raised certain other arguments. However, since we are allowing the appeal on the merits, we do not consider it necessary to go into other aspects. 45. The appeal is accordingly allowed.

 
 
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