2008 (10) TMI 136 - AT - Service Tax

When the Service Tax liability has been discharged before the issue of show-cause notice, then penalties under sections 76, 77 and 78 are not justified therefore, dropping of penalties by Commissioner (Appeals) is legal and proper - impugned order is not correct to the extent of dropping the interest - impugned order is modified by ordering payment of interest only and setting aside the penalties confirmed

Summary

The Appellate Tribunal CESTAT Bangalore ruled in favor of the appellant in an appeal against Order-in-Appeal No. 118/2007-CE. The Tribunal held that penalties were not justified when Service Tax liability was discharged before the show-cause notice. Interest payment was ordered while penalties were set aside. The revenue appeal was disposed of accordingly.