Licensing right to use trademarks and franchises is right to use intellectual property which merits classification under code 9973 and the same is chargeable to CGST @ 6% and SGST @ 6%.
Classification of service— In the instant case, applicant has entered into a technology license agreement with its’ franchisee across India, wherein ’the Applicant has granted the Licensee the right to use the system, the system property and marks for the term, solely in connection with the conduct of business at the outlet and subject to terms and conditions of the agreement.
classification code/heading 998396 does not cover the activity of licensing right to use trademarks and franchises, as the same is covered vide classification code/chapter heading 997336. Further, Group 99733 covers Licensing services for the right to use intellectual property and similar products. Therefore, licensing services: for right to use the “system” and “system property” in respect of which advance ruling has been sought in the instant case being right to use intangible property which is similar to copyright, patents, trademarks, designs, which is also capable of being possessed, transferred and their right to use can be licensed, merits’ classification under the group 99733.
Held that— In terms of clause (c) of pare 5 of Schedule II of the Central Goods and Service Tax Act, 2017, the impugned activity right to use “system” and “system property” is right to use intellectual property which merits classification under code 9973 and the same is covered vide serial number 17(i) of Notification no. 11/2017 (central tax rate) chargeable to CGST @ 6% and. SGST @ 6%.
Licensing right to use trademarks and franchises is right to use intellectual property which merits classification under code 9973 and the same is chargeable to CGST @ 6% and SGST @ 6%.
Classification of service— In the instant case, applicant has entered into a technology license agreement with its’ franchisee across India, wherein ’the Applicant has granted the Licensee the right to use the system, the system property and marks for the term, solely in connection with the conduct of business at the outlet and subject to terms and conditions of the agreement.
classification code/heading 998396 does not cover the activity of licensing right to use trademarks and franchises, as the same is covered vide classification code/chapter heading 997336. Further, Group 99733 covers Licensing services for the right to use intellectual property and similar products. Therefore, licensing services: for right to use the “system” and “system property” in respect of which advance ruling has been sought in the instant case being right to use intangible property which is similar to copyright, patents, trademarks, designs, which is also capable of being possessed, transferred and their right to use can be licensed, merits’ classification under the group 99733.
Held that— In terms of clause (c) of pare 5 of Schedule II of the Central Goods and Service Tax Act, 2017, the impugned activity right to use “system” and “system property” is right to use intellectual property which merits classification under code 9973 and the same is covered vide serial number 17(i) of Notification no. 11/2017 (central tax rate) chargeable to CGST @ 6% and. SGST @ 6%.