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2019 (3) TMI 1180 - AT - Service TaxRevenue neutrality - Reverse charge mechanism - appellant had received various taxable services from overseas service providers who do not have office in India and incurred charges/expenses in foreign currency - service tax not paid - Held that:- It is seen that the appellants are liable to pay service tax in the present demand under reverse charge mechanism as per Section 66A of the Finance Act, 1994. It is very much true that in case the appellants pay the service tax on reverse charge basis, they would be eligible to avail credit on the said amount as a service recipient. Thus, the situation is truly a revenue neutral one. On such score, the appellant cannot be saddled with the allegation of intention to evade payment of service tax. Penalty - Held that:- The Hon’ble jurisdictional High Court in the case of C.C.E., Chennai-IV Vs. M/s. Tenneco RC India Pvt. Ltd. [2015 (7) TMI 342 - MADRAS HIGH COURT] has observed that when the entire exercise is revenue neutral, the assessee could not have achieved any purpose by evading duty - Taking note of the fact that the situation is a revenue neutral one, this is a fit case for setting aside the penalty imposed under Section 78 of the Finance Act, 1994. Penalty set aside - rest of demand upheld - appeal allowed in part.
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