2008 (8) TMI 153 - AT - Service Tax

Commission received for selling the SIM cards of Hutch post paid mobile - non-payment of tax - appellant was under bona fide belief that they need not discharge the Service tax liability appellant discharged the duty liability along with interest even before the issue of SCN - imposition of penalty under Section 76 appears to very harsh penalty is set aside

Summary

The Appellate Tribunal CESTAT, Bangalore ruled in favor of the appellant who did not pay Service tax on commission received for selling SIM cards of Hutch postpaid mobile. The appellant believed they were exempt from paying Service tax based on Notification 13/2003-S.T. The Tribunal found the appellant acted in good faith and set aside the penalty under Section 76, allowing the appeal with consequential relief.