Cotton Blossom India Pvt Ltd Vs Commissioner of GST & Central Excise (CESTAT Chennai)
CESTAT Chennai held that no documents have been produced showing that foreign bank has charged any amount from the appellant directly. Thus, service tax on foreign bank charges not payable under reverse charge mechanism as the appellant cannot be treated as service recipient.
Facts- The appellant appears to have given a discount on the gross value of the exports which was reflected in the invoice raised by the appellant as well and hence, appellant received 97% of the gross value of the export in its bank account (Bank of Maharashtra). The said 3% was in fact retained by AFL as its fees. Deutsche Bank also deducted the processing fees out of the amount paid to the appellant. The said 3% was considered by the Revenue as the charges/fees for Banking and Financial Services and hence, the appellant was liable to pay Service Tax on the said amount on Reverse Charge Mechanism.
The same was proposed and communicated in the form of Show Cause Notice 24.10.2013 and it appears that the appellant filed its reply for the charges/proposals made in the SCN. But however, the Original Authority having considered the same in adjudication, vide OIO dated 26.12.2014, proceeded to confirm the proposals made in the Show Cause Notice. The said demand in OIO has been assailed in this appeal by the appellant.
