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2014 (1) TMI 1602 - AT - Service TaxPenalties under Section 76, 77 and 78 - Demand of service tax - Business Auxiliary Services - Computerised data processing services - Held that:- In the show cause notice it was alleged that the customers of the bank submitted physical documents at the bank's branches and the appellant performed computerised processes on the input submitted to the bank using the bank's systems and saved the output on the bank's system, which amounted to services incidental or auxiliary to the customer care services rendered by the bank, whereas the reasoning recorded in the impugned order is that the appellant collected data from the clients' customers, and the banks during the course of providing banking services also provided customer care services, and the services rendered by the appellant to the bank would be incidental or auxiliary to the customers care services provided by the bank. Thus, there is a complete variation between the ground alleged in the show cause notice and the grounds on which the demands have been confirmed. On that ground alone the impugned order is liable is to be set aside. Since bulk of the service has been rendered to clients located abroad and the payments has been received in convertible foreign exchange, the appellant is not liable to pay service tax on the export of services undertaken by them. In any case the exemption under Notification NO. 21/2003 dated 20/11/2003 would have been available to them since the consideration for the services rendered was received in foreign currency. For the period prior to 20/11/2003, Board's circular dated 24/05/2003 clarifies that no service tax would be leviable on export of services for which consideration is received in convertible foreign exchange - Decided in favour of assessee.
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