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2018 (8) TMI 1179 - AT - Service TaxForeign Banks Charges - liability of service tax - reverse charge mechanism - appellant have made payment of ₹ 3,16,46,565/- under the head of Foreign Banks Charges to the Foreign Banks towards interest, Foreign Bank Commission / Charges, Foreign Bank Charges for LC-retired and other charges - Held that:- From the Circular 20/2013-14-ST-I (Commissioner of ST-I, Mumbai T.N.) dated 10.02.2014 , it is clear that when the Indian Banks are collecting charges including the charges of Foreign Banks toward import and export of the goods of their client. In such case, as regard the service tax liability under Reverse Charge Mechanism, the Indian Banks are recipient of service, therefore, the appellant cannot be held as recipient of service provided by Foreign Banks to the Indian Banks. Accordingly, the appellant is not liable to pay service tax under Reverse Charge Mechanism. This very same issue has been considered by this Tribunal in the case of Greenply Industries Ltd [2015 (12) TMI 80 - CESTAT NEW DELHI], wherein Division Bench of this Tribunal has held that when the assessee is not directly making the payment to the Foreign Banker towards any service provided by the said Foreign Banker to the Indian Bank, the assessee is not liable to pay service tax. Any bank charges paid by Indian Bank to the Foreign Banks even though in connection with import and export of the goods and the same was debited to the appellant, the service tax liability does not lie on the appellant. Matter remanded to adjudicating authority to verify the quantification and if any service tax liability arises, the same may be demanded from the appellant - appeal allowed by way of remand.
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