TaxTMI 
TaxTMI 
2026 (8) TMI 1706
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....ng with interest and penalties, principally under the categories of "Banking and Other Financial Services" and "Scientific or Technical Consultancy Services", in respect of the period 2011-12 and 2012-13 (up to June, 2012). 2. Heard the Learned Counsel for the appellant and the Learned Authorized Representative for the Revenue and perused the records with submissions. 3. The dispute essentially involves the following two issues; i) Whether the appellant, being an exporter of goods, can be regarded as recipient of services rendered by foreign banks/intermediary banks involved in transmission of export proceeds remitted by foreign buyer and, consequently, whether Service Tax is payable by the appellant under Reverse Charge Mech....
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....ted 09.09.2020. In that case, this Tribunal examined the liability in respect of deductions made by foreign banks while transmitting export proceeds and set aside the demand. 7. The factual matrix for the present period is not shown to be materially different. No material has been produced by Revenue to demonstrate that the appellant had engaged the foreign banks, entered into any contractual arrangement with them, or was otherwise under an obligation to pay consideration to such foreign banks for any service rendered to it. 8. Merely because the appeal ultimately bears the economic impact of deduction of certain charges in the chain of remittance, it cannot automatically we concluded that there exists a service provider-service recip....
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.... demand of Service Tax under Banking and Other Financial Services on charges deducted by foreign/intermediary banks is not sustainable and is liable to be set aside. 13. Scientific or Technical Consultancy Services The second issue relates to payments made by the appellant to M/s DADA Consultancy and M/s Pharpe Dr. D.R. Iban. 14. The appellant manufacturers and exports Pharmaceutical products. For marketing such products in overseas jurisdictions, approvals of the concerned regulatory authorities are required. For obtaining such approvals, applications containing dossiers relating to product composition, specifications, analytical results and other particulars to be filed with the regulatory authorities. 15. For the purpose, the....
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....y requirements for marketing Pharmaceutical products abroad cannot, merely on that account, be classified as Scientific or Technical Consultancy Services. 19. The essential character of the service has to be determined from the nature of the activity actually undertaken and not merely from the professional qualifications of the persons rendering the service. Possession of scientific or technical expertise by such consultant does not ipso facto make every activity undertaken by such consultant a "Scientific or Technical Consultancy Service". 20. For the taxable service in question, there must be advice, consultancy or scientific/technical assistance rendered by a scientist, technocrat or a science or technology institution/organization....
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....erwise, in so far as the allegation regarding Scientific or Technical Consultancy Services is concerned, the record indicates that the appellant had been discharging Service Tax treating the activity under another taxable category. The dispute was thus essentially one of classification and interpretation. Such circumstances also do not warrant imposition of penalty for alleged short payment arising merely on account of a different classification adopted by Revenue. 24. The appellant has further raised a specific contention regarding computation of penalty under Section 76 of the Finance Act, 1994 in view of the amendment effective from 08.04.2011. However, since the substantive demands themselves are being set aside, it is unnecessary to....