Are Cloud Services taxed?

I do not pay any taxes for charges paid to cloud computing service or purchasing a mobile application in android platform. I learn that all services in India are taxable. How about cloud services or mobile application service?

Cloud Computing allows Governments and Companies to access IT resources as a Service over the Internet. One is not required to invest in the IT infrastructure, Software and Services upfront. The software and data is stored on the servers of the Cloud Computing Service provider.

Taxation of cloud services is complex and is subject to the fact where is the Cloud located. Across the world, the practice is to tax where it is used, whereas in some cases,it is taxed where the service is offered( location of the server) or it is taxed where the office of the cloud computing provider is located. If companies are accessing Cloud Services from outside India, can the Indian Government tax it?
I might need to understand International law and Taxation domain and this is going above my head/ knowledge.

Governments depend on tax revenues on goods sold within their borders. How will the Indian government like to treat the cloud? They would like to follow an approach similar to off-the-shelf software purchases, which are of course taxed. How will the cloud computing company project this? They would claim that Cloud computing amounts to providing Software as a Service which will be governed by the local laws where the cloud computing company is located or where their servers are. These locations are mostly in the US where these are non taxable. As Infrastructure, Platform and Storage is provided as a service on the cloud model, this is going above my head/ knowledge.

Now I am in confused state.. On one hand as Indian citizen, I do not want Indian government to lose the tax revenues. At the same time, I would like Indian companies to make use of cloud computing and save costs,be leaner and more efficient. if Indian company wants to offer cloud computing services,this company would be under Indian tax jurisdiction and the cost would become charges + taxes. Can this company compete against the existing ones?

Are the above leading to the reason to my own question,”why the cloud computing providers like amazon and azure do not have cloud data centers in India?”. For both these providers, I was able to use my Indian credit card.