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TMI Blog2017 (9) TMI 235X X X X Extracts X X X X X X X X Extracts X X X X ..... e provisions of Section 66A of the Finance Act, 1994 and the provisions contained in Taxation of Services (Provided from Outside India and Received in India) Rules, 2006. It was noticed that the appellant failed to discharge the service tax liability in certain cases. The appellants were making payments or making provisions for payment in their books of accounts when dealing with their group companies of abroad. As per the explanation (c) inserted on 10/05/2008 in Section 67 of Chapter V of Finance Act, 1994. Even the payment of service tax is required to be paid on the amount for which provisions for payment related to the transaction with associated enterprises is made in the books of accounts of a person. It was observed that on such amo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is due to inadvertent that the appellant continued to follow the provisions prevailing prior to 10/05/2008. It is also fact that they have been showing the amount of provision in their books of accounts. Therefore, that amount in any case was not liable to service tax at the time of making provision but at the time of payment of the said amount to the foreign service provider. Therefore, in the peculiar fact of the case, the suppression of fact is not established. He further submits that the service tax which was payable on the amount of provision made in the books of accounts was instantly available as a Cenvat Credit to the appellant themselves. On such a situation, the excise duty which they are paying on the finished goods stand reduced ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reason that the Cenvat Credit of the same amount is available to the assesee. He submits that the appellant did not declare the service value in their ST-3 return, therefore, there is a clear suppression of fact of the appellants. Accordingly, the penalty imposed under Sections 76 & 78 cannot be waived. 4. We have carefully considered the submissions made by both the sides. We find that the issue is that the appellant was liable to pay service tax on the amount for which provision was made and booked in their books of accounts of the appellant. It is observed that the appellant was otherwise making their regular payment of service tax in respect of service charges paid to the foreign service provider, which was a legal provision prior to 1 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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