Case nº Ruling No. AAR/ST/07/2016 in Application No. AAR/44/ST/14/2014 of AAR Cases, March 04, 2016 (case In Re : Universal Services India Pvt. Ltd. Vs)

Judge:For Appellant: Shri S. Thirumalai, Advocate and For Respondents: Shri Govind Krishna Dixit (AR)
President:Justice V.S. Sirpurkar, Chairman, Shri S.S. Rana and R.S. Shukla, Members
Defense:Service Tax Rules, 1994 - Rule 6A
Resolution Date:March 04, 2016
Issuing Organization:AAR Cases
 
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Order:

  1. Universal Services India Private Limited (hereinafter also referred to as the applicant) proposes to enter into a ''Services Agreement'' with Wild West Domains, LLC, (hereinafter referred to as WWD US) located in Arizona, USA and incorporated in Delaware, USA. WWD US is domain name registrar and provides other web services to customers across the world. Vide the proposed services agreement, the applicant intends to provide payment processing services to WWD US, wherein it proposes to assist the customers of WWD US located in India with the processing of payments to WWD US. Applicant states that WWD US will provide its services and products to customers in India through its website. In respect of such services, the customers would make the payment to WWD US online. For making such payment, in case the customers use an international credit card, they will be able to make the payment directly to WWD US in US Dollars. Customers will also be able to pay for the services by using their Indian credit cards for bank payment facilities and make payments in Indian Rupees (''INR''). To enable customers using Indian credit card to pay for the services in INR, WWD US desires the applicant to provide payment processing facilities in India and collect money from the customers of WWD US in India and remit the same to WWD US. As far as provision for the payment collection services to WWD US is concerned, the applicant shall outsource the said activity to a third party service provider in India, who would provide necessary payment collection gateway facility to the customers, who may wish to effect payment in INR by using their Indian credit cards. Towards this, the applicant proposes to open a separate bank account in India wherein the payment collection gateway company appointed by the applicant will deposit the money so collected from the customers of WWD US. Further, it is also contemplated that the applicant may allow the customers to directly deposit money in its bank account using their net banking facility. Thereafter, all such collections will be transmitted by the applicant to WWD US on actual basis, i.e., without any mark-up. In consideration for the abovementioned services, the applicant shall charge a fee equal to the operating costs incurred by the applicant plus a mark-up of 13% on such costs. It is proposed that the applicant would receive such fee from WWD US for services provided by it in US Dollars. Applicant submits that WWD US would be the only customer of the applicant. The applicant would not provide any services for or on behalf of WWD US in India or outside India. The applicant is not authorized to enter into any contract or arrangement on behalf of WWD US or which bind it in any manner whatsoever. WWD US will directly contact and provide services to customers in India. The applicant will not be engaged in arranging or facilitation of services of WWD US to customers in India. Furthermore, the applicant will also not be engaged in any manner to arrange or facilitate the provision of any service by any third party service provider to WWD US. The only service to be performed by the applicant would be as stipulated in the draft service agreement.

  2. WWD US, through its website ''http://who.wildwestdomains.com/'' is engaged in the business of providing name registration, web hosting, designing and other services. The nature of services provided by WWD US is outlined below:

    (a) Domain name registration and transfer services: WWD US registers and transfers both generic top level domains, including the prominent domains such as.com,.net,.org, and.info, as well as country code top level domains including,.us,.ca,.mx,.fr,.it,.de and.es. Any user desirous of obtaining any particular domain can access a website of WWD US and place a request for the same. Upon...

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