[@clouddataquest ] Thanks for reaching out. As per the screenshot looks like you are using the Get file content using Path and then using Create File action to create the file in azure storage file share. Please confirm if my understanding is correct.
I tested the same at my end using consumption logic app and I didn't face the same issue as you have mentioned.
Can you please confirm if you have selected Yes for Infer Content Type, so the connector takes care of what your file content type is. Please validate if the configuration is same as below.
In case if you still observe the same issue then please share your workflow configuration and make sure that the file content is same while creating the file and not changed in your workflow.
Update:
Thank you for the offline discussion. As we were using the Infer Content Type as Yes and your file type is xml then logic app treated the content-type as text/xml and that is the reason the content was not encoded properly. When we select the Infer Content Type as No then logic app will tread the content as application/octet-stream content-type (used for unknown binary files) and therefore it encodes the content as per the actual content and doesn't change.
For more details, please refer to this document.