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TMI Blog2016 (5) TMI 845X X X X Extracts X X X X X X X X Extracts X X X X ..... er the demand was reduced to ₹ 26.36 lacs which is for the period July, 2012 to March, 2013, this shows that there was serious confusion among the assessee as well as department about the levy of service tax on the services provided to State Government Electricity distribution companies. However when the issue was made clear the entire service tax demand confirmed has been paid before adjudication alongwith interest. I found that appellant have shown reasonable cause for non payment of service tax on due date. Accordingly they have made out a case for waiver of penalty in terms of Section 80 of the Finance Act,1994. Therefore the penalty imposed under section 78 invoking Section 80 of the Finance Act is waived of. As regard the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed to the Govt. account. ii) I confirm recovery of interest from the noticee, on the aforesaid amount of ₹ 26,36,363/- under Section 75 of the Finance Act, 1994. iii) I impose penalty of ₹ 13,18,182/-@ 50% of the amount of Service Tax confirmed in terms of 1st proviso to Section 78 of the Finance Act, 1994. However, since details of the transactions are available on their specified records penalty would further be reduced to ₹ 6,59,091/- @ 25% of ₹ 26,36,363/-, if interest and 25% penalty also paid within 30 days of receipt of this order. iv) I order recovery of late fee, from the noticee, @ ₹ 2,000/- per ST-3 Return for the period from April 2008 to March, 2011 and @ ₹ 20,000/- per ST-3 re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d filing of ST-3 returns under Section 70 of the Finance Act, 1994 read with Rule 7C of Service Tax Rules. 3. Shri. Amit Agrawal, Ld. C.A. with Shri. Kaushik Khairnar, Ld Counsel appearing for the Appellants submit that the appellant is providing service exclusively to State Government company i.e. M/s. MSEDCL therefore all the transaction are legitimate and the same is as per the contract between them and the M/s. MSEDCL therefore there is no malafide intention on the part of the appellant. He further submits that the issue of taxability on the services provided to the M/s. MSEDCL was under the dispute and therefore the government has issued notification to exempt the said services provided to transmission and distribution companies of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le on their services provided to M/s. MSEDCL when it was made clear that service is taxable during the adjudication process appellant admittedly paid entire amount confirmed in the adjudication order alongwith interest and in this fact, penalty should not have been imposed on the appellant under Section 78. As regard the late fee for filing the ST3 returns, he submits that the requirement of filing of ST 3 returns arises only when the service is taxable. In the present case, admittedly services are not taxable till 30/6/2012. Since in major period the service tax was not leviable, there was no need to file any return, accordingly no late fee could have been demanded by the Adjudicating authority. 4. Shri. V. Kaushik, Ld. Asstt. Commissio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... made exempted from retrospective effect. It is also observed that even from Jul, 2012 the negative list of services was introduced in the Union Budget, 2012 wherein electricity distribution utility services listed in the negative list. This entry further created confusion that whether the appellant is falling under the negative list or otherwise. Therefore as per the above confusion, it is clear that the appellant entertained bonafide belief and hence not paid the service tax. However when the issue was made clear the entire service tax demand confirmed has been paid before adjudication alongwith interest. I therefore find that appellant have shown reasonable cause for non payment of service tax on due date. Accordingly they have made out ..... X X X X Extracts X X X X X X X X Extracts X X X X
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