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TMI Blog2017 (9) TMI 96X X X X Extracts X X X X X X X X Extracts X X X X ..... nism - Held that: - The foreign bank in which the overseas buyer deposits the sale proceeds is chosen by the foreign buyer and not by the appellant, who is situated in India. By no stretch of imagination can such foreign bank be considered as a service provider for the appellant who in most cases would not even be aware of the identity of such foreign bank. The act of deduction of an amount as charges for transfer of the foreign exchange to the Indian bank from the sale proceeds of the appellant is only a facility for collecting such charges from the Indian bank. This cannot be considered as payment of charges for services by the appellant to the foreign bank. It is actual charges deducted being bank to bank transaction. Similar issue de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in taxable territory for which the appellant as a service recipient is liable to discharge service tax under reverse charge mechanism. Since the appellants have not paid service tax allegedly being paid to the foreign bank, show cause notices were issued for different periods. After adjudication, the original authority confirmed the demand along with interest and imposed equal penalty under section 78 apart from imposing penalty of ₹ 10,000/- under section 77 sub-clause (i)(a) for failure to take registration and a penalty of ₹ 10,000/- under section 77 sub-clause (i)(b) for non-filing of returns. Being aggrieved, they filed appeals before Commissioner (Appeals) who upheld the same. Hence these appeals. 3. On behalf of the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... levy of service tax under reverse charge mechanism. He also argued on the issue of limitation and submitted and all such documents were available as part of the accounts and that the appellant had not paid service tax only on bonafide belief that the said amount is not liable to service tax. As there is no suppression of facts, extended period is not invocable. Ld. Counsel relied upon Trade Notice No. 20/2013-14-ST-I dated 10.2.2014 and submitted that the Board has clarified the said issue and stated that the said charges deducted by the foreign bank is not subject to levy of service tax at the end of the exporter/manufacturer. He also relied upon in the case of Greenply Industries Ltd. Vs. Commissioner of Central Excise 2015 (38) STR 605 ( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce provider and service recipient relationship between the foreign bank and the appellant. It is to be noted that the foreign bank deducts such charges and transfers the foreign exchange to the Indian bank from where the appellant receives the money. The foreign bank in which the overseas buyer deposits the sale proceeds is chosen by the foreign buyer and not by the appellant, who is situated in India. By no stretch of imagination can such foreign bank be considered as a service provider for the appellant who in most cases would not even be aware of the identity of such foreign bank. The act of deduction of an amount as charges for transfer of the foreign exchange to the Indian bank from the sale proceeds of the appellant is only a facility ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aceuticals Ltd. v. Commissioner of Central Excise, Jaipur-I -2013 (32) S.T.R. 249 (Tri.-Del.), M/s. Gujarat Ambuja Exports Ltd. v. Commissioner of Service Tax, Ahmedabad 2013 (30) S.T.R. 667 (Tri. Ahmd.)]. Similar issue was considered by the Tribunal in the case of Greenply Industries Ltd. (supra). The relevant portion is reproduced as under:- 5. We have considered the submissions from both sides and perused the records. We find that no documents have been produced showing that foreign bank has charged any amount from the appellant directly. The facts as narrated in the impugned order clearly indicate that it is the ING Vyasa Bank who had paid the charges to the foreign bank. In view of this, the appellant cannot be treated as ser ..... X X X X Extracts X X X X X X X X Extracts X X X X
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