Reverse charge mechanism: exporter not liable for foreign bank charges when Indian bank is the direct service recipient.
The core issue is whether an exporter is liable under the Reverse Charge Mechanism for foreign bank charges deducted from export proceeds when those charges are imposed on and paid by an Indian intermediary bank. The Tribunal's analysis focuses on the definition of service recipient and territorial scope, concluding that the direct recipient-the Indian bank-is the party liable to discharge service tax while the exporter, as an indirect beneficiary without direct dealings with the foreign bank, is not subject to reverse charge.