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2019 (6) TMI 829 - AT - Service TaxTaxability - Business Auxiliary Service - Commission received - Commission Agent service provided to China based Company - export of service - HELD THAT:- Demand was on the Business Auxiliary Service i.e. commission received from the China based client which is in relation to facilitating the client for supply of goods from India to China. Against such service, the consideration received was in convertible foreign exchange and therefore, the fact that the service provided from India to the client based in China, the consideration received is in convertible foreign exchange, the service is qualified as export service and hence the same is not taxable. Commission income received in relation to the business of textile processing - applicability of N/N. 14/2004-ST dated 10.09.2004 - HELD THAT:- Undisputedly the commission is related to textile processing business which is clearly exempted by Notification No. 14/2004-ST, therefore, the said demand is also not payable. Demand of penalty u/s 76 and 78 - service tax alongwith interest paid - HELD THAT:- As held by the Hon'ble Gujarat High Court in the case of M/S RAVAL TRADING COMPANY VERSUS COMMISSIONER OF SERVICE TAX [2016 (2) TMI 172 - GUJARAT HIGH COURT], simultaneous penalty under Section 76 and 78 cannot be imposed. Accordingly, the penalty imposed under Section 76 is set-aside. As regards the penalty imposed under Section 78, we find that both the lower authorities have not extended benefit of option to pay 25% under the proviso to Section 11AC, therefore, in the light of Hon'ble Supreme Court judgment in the case of COMMR. OF CEN. EXC. & CUSTOMS VERSUS M/S R.A. SHAIKH PAPER MILLS P. LTD. [2016 (4) TMI 1076 - SC ORDER] the appellant is entitled for the option to 25% penalty. Accordingly, the penalty is reduced to 25% subject to the condition that entire amount of tax of ₹ 84,270/- along with interest and 25% penalty of said service tax is paid within one month from the date of this order. Appeal allowed in part.
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