2019 (10) TMI 692

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....in providing taxable services under the category of "banking and other financial services" during the relevant period and has been paying the Service Tax on all taxable services and also filing the Service Tax Returns. The bank is acting as an agent of Reserve Bank of India for carrying out various Government transactions involving receipt and payment on behalf of Central and State Governments and also receives commission known as agency commission from RBI for carrying out these transactions. The Government do not maintain any account with the bank. In respect of pension payments, bank parts its funds first and reimbursement is claimed from the corresponding Department or Ministry excepting in case of Provident Fund pension. Further, the b....

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....are the agent of RBI while performing the Government transactions therefore they are also not liable to pay Service Tax and is also covered under the negative list. She further submitted that as per the Larger Bench, they are not liable to pay Service Tax but since the RBI vide their letter dated 04.11.2016 has asked them to pay the Service Tax and seek reimbursement of the same from them. Therefore, in compliance with that direction, the appellant had remitted the Service Tax even before the same is collected from RBI. She also submitted that they have paid the Service Tax in compliance of Section 73A which provides that once an amount is collected as Service Tax, the same has to be deposited to the Government. She also submitted that the ....

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....as its agent under Section 45 of the RBI Act. RBI itself has been entrusted by the Central Government to transact Government business. Hence, once State Bank of Patiala has been appointed as agent of RBI, it is transacting Government business which is in the nature of a sovereign function performed on behalf of the Government and hence not liable to Service Tax." 6.1. Further, I find that the appellant in compliance of the direction of the RBI dated 04.11.2016 paid the Service Tax even before collecting the same from RBI. Further, I find that the appellant has paid the Service Tax in compliance of Section 73A(2). Further, I find that in the facts and circumstances of the case demanding interest under Section 75 is not tenable in la....