9911796707
TMI Blog2015 (9) TMI 160X X X X Extracts X X X X X X X X Extracts X X X X ..... . The appellant had availed lending services from service providers based abroad namely, Lehmann and IFC who acted as the Mandated Lead Arrangers, Facility Agents and lenders in relation to Economic Commercial Borrowings (ECB). The fees paid by the appellant in foreign exchange to the lenders abroad as management fees, facility agent fees and appraisal fees was held to be liable to service tax under the category of 'Banking and other Financial Services' defined under section 65 (12) (a) (ix) read with section 65(105)(zm) in terms of sections 66A and 68 (2) on reverse charge basis as recipient of the taxable service. The demand was confirmed for the period July 07 to Dec 07 under section 73 (1) invoking the extended time period for f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The belief of the appellant is malafide rather than bonafide. According to him penalty is imposable in terms of the Hon'ble Supreme Court decision in the case of Commissioner versus KitPly Industries Ltd. 2011 (267) ELT 289 (SC). 6. We have carefully gone through the facts of the case and considered the submissions of both sides. It is undisputed that the service tax was paid by the appellant after the issue of the show cause notice and before the passing of the adjudication order. The appellant relies heavily on the judgement cited. Revenue relies on the decision of the Apex court in the case of Kitply Industries (supra). We note that the Apex court, after considering the Larger Bench decision in the case of Jay Yushin Ltd (supra), ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... misused by the appellant. Therefore clauses (a) and (b) are not applicable to the facts of the present case. Quite apparently, clause (d) too does not apply. In the present situation it is merely a case of applying clause (c) above. The revenue neutral situation comes about in relation to the credit available to the appellant himself and not by way of availability of credit to anyone else. Therefore the case of Jay Yushin Ltd applies in the present situation after considering the guidance drawn by the Supreme Court in the case of KitPly Industries (supra). In this view of the matter, as the entire exercise is revenue neutral we find that mens rea is not established for imposition of penalties. Having considered the matter on this aspect on ..... X X X X Extracts X X X X X X X X Extracts X X X X
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