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[varghese]

Have a look at the video. Is the player in while doing the legal serve?

From Varghese's Table Tennis Videos on Vimeo.

[hurricane]

Ya I think its OK!

[729 fx]

According to ITTF Rules, (in summary) :
1) Ball must be behind end line when serving
2) Ball must be place on hand visible to opponent and umpire(s)
3) Ball must be thrown upwards (around 6 inches height) and hit with the racket on its way down.

Based on all these, the video shows one tricky serves. Yes, I think it is legal, too.