B. Ravichandran ORDER
B. Ravichandran, Member (T)
1. These appeals are against the common impugned order dated 28.02.2014 of Commissioner of Service Tax, New Delhi. Both Revenue as well as the assesses preferred appeal. The appellant-assesses are engaged in providing management or business consultant service liable to tax under Section 65(105)(r) of the Finance Act, 1994 read with Section 65(65). Proceedings were initiated against the appellant-assesses by way of issue of SCN dated 17.10.2012. The demand is for recovery of service tax under the category of Management or Business Consultant Service for the period 2007-08 to 2011-12. A total demand of Rs. 1,15,05,871/- was made in the notice. An amount of Rs. 2,710/- was also sought to be recovered as in-eligible Cenvat credit. The appellant-assesses contested the demand. The case was adjudicated resulting in the impugned order. The original authority held that the appellants are liable to pay service tax of Rs. 21,32,201/-. He dropped a demand for Rs. 93,73,670/-, which is attributable towards reimbursable expenditure incurred by appellant-assesses while providing service. He also ordered recovery of Rs. 2,710/- towards irregular Cenvat credit availed by the appellant-assesses. Penalties were imposed under Sections 77 & 78of Finance Act, 1994.
2. The Ld. Counsel appearing for the appellant submitted that a demand of Rs. 6,76,382/- has been confirmed on the ground that the appellant-assesses provided management or business consultant service to M/s. Nippon Koei Co. Ltd., Japan. The Ld. Counsel submitted that the service is received by the foreign based client and consideration is received by the appellant-assesses inconvertible foreign exchange. It is a case of export of service, not liable to Service Tax. He relied on various decided cases in support of his contention.
3. On the second issue regarding liability of service tax in respect of certain expenses shown in foreign exchange in their balance-sheet, it is contended that the Revenue could not clearly establish that the services received in lieu of such expenditure in foreign exchange are, in fact, covered by tax entry of management or business consultant service. The demand is made based on the details available in appellants accounts regarding expenditure in foreign exchange. Such presumptive demand cannot be legally sustained.
4. Without prejudice to the same, the Ld. Counsel submitted that tax liability, if any, paid by the appellant-assesses on such services on reverse charge basis shall be eligible as a credit and in such situation, there can be no allegation of intention to evade tax. As such, the demand cannot be made for extended period and no penalty can be imposed in such situation.
5. Regarding an amount of Rs. 2,710/- confirmed towards irregular Cenvat credit, it is submitted that the said amount has already reversed and the same has not been property recognized by the lower authority.
6. On the appeal filed by the Revenue, the Ld. Counsel for the appellant-assesses submitted that the original authority correctly applied the ratio of the decision of Hon'ble Delhi High Court in M/s. Intercontinental Consultants & Technocrats (P) Ltd.,