9911796707
TMI Blog2012 (9) TMI 336X X X X Extracts X X X X X X X X Extracts X X X X ..... nce proceedings where the assessee discharges full amount of service tax and interest Penalty under Section 78 – Held that:- Where there was no need for the appellants to resort to suppression or mis-declaration since whatever service tax was to be paid, they were eligible for the credit - By evading the payment of service tax, the appellant stands to lose rather than getting any undue benefit. By delaying payment of service tax, the assessee had to pay interest on the amount which is not available as cenvat credit - in this case, suppression of fact or mis-declaration could not have been invoked for imposition of penalty under Section 78 of the Finance Act, 1994 - there is no other evidence to justify imposition of penalty - appeal is a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lso submits that appellants were under the impression that they were not required to pay interest and after paying service tax they had intimated the department on 19-12-2008. However no reply to this letter was received and the department initiated proceedings by issuing show cause notice on 12-7-2009 and even though the appellant paid the interest as soon as the show cause notice was issued yet penalties under various sections of the Finance Act, 1994, have been imposed. He submits that in those cases where the provisions of Section 73(3) are applicable, no show cause notice should have been issued and therefore, penalties imposed are not imposable. 3. Learned AR submitted that provisions of Section 73(3) are applicable only when servic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d, then the [Central Excise Officer] shall proceed to recover such amount in the manner specified in this section, and the period of one year referred to in sub-section (1) shall be counted form the date of receipt of such information of payment. [Explanation 1]. - For the removal of doubts, it is hereby declared that the interest under Section 75 shall be payable on the amount paid by the person under this sub-section and also on the amount of short payment of service tax or erroneously refunded service tax, if any, as may be determined by the [Central Excise Officer], but for this sub-section. [Explanation 2]. - For the removal of doubts it is hereby declared that no penalty under any of the provisions of this Act or the Rules made ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d together, in this case also, a letter should have been written to the assessee to pay interest and if they fail to pay interest, show cause notice should have been issued. There is no evidence on record to show that any such letter was written by the Revenue. Nevertheless, at least after issue of show cause notice, once the interest amount was paid, this was a fit case for dropping the further proceedings. Instead of doing so, I find that penalties have been imposed under Sections 76 and 77. This is contrary to the provisions of Section and the CBEC has also issued a letter dated 3-10-2007 wherein the field offices have been directed not to commence proceedings where the assessee discharges full amount of service tax and interest. 6. Co ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
