2011 (9) TMI 788 - HC - Service Tax

Penalty under Section 76 of the Finance Act, 1994 for non-payment of service tax on due dates - The material on record discloses that the assessee on being pointed out by the authorities for not paying the service tax, has paid the service tax with interest even before the issue of show cause notice - It is unfortunate that inspite of statutory provisions, the authorities have issued a show cause notice claiming penalty. So tax and interest was paid before issue of show cause notice - Appeal is dismissed

Summary

The Karnataka High Court dismissed the appeal by the Revenue against an order setting aside penalties for non-payment of service tax. The assessee paid the tax and interest before a show cause notice was issued, as per statutory provisions. The Tribunal's decision was upheld as legally sound. The substantial question of law was answered in favor of the assessee.