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TMI Blog2023 (7) TMI 107X X X X Extracts X X X X X X X X Extracts X X X X ..... f the Finance Act, 1994. Reliance placed in the case of M/S. C.C.I. LOGISTICS LIMITED VERSUS COMMISSIONER OF CGST CX, KOLKATA NORTH COMMISSIONERATE (ERSTWHILE SERVICE TAX-I KOLKATA COMMISSIONERATE) [ 2021 (6) TMI 546 - CESTAT KOLKATA ] where it was held that Since the tax amount alongwith interest has already been deposited by the assessee, I do not find any reason to uphold the penalty amount in absence of evidence of fraud or suppression with an intent to evade payment of tax. Hence, the penalty imposed is set aside. There was no mala fide intention on the part of the Appellant to evade payment of service tax. Accordingly, the penalty imposed under section 78 of the Finance Act, 1994, is liable to be set aside - there is no ingredient available in this case to impose penalty under section 76 of the Finance Act , 1994. Accordingly, the Department appeal is liable to be rejected - The department appeal is rejected. - Service Tax Appeal No. 46 of 2010 Service Tax Appeal No. 48 of 2010 - FINAL ORDER NO. 75874-75875/2023 - Dated:- 28-6-2023 - HON BLE SHRI P. K.CHOUDHARY , MEMBER ( JUDICIAL ) And HON BLE SHRI K. ANPAZHAKAN , MEMBER ( TECHNICAL ) Shri K.Chowdhu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ice. As there was no suppression involved, penalty under section 78 of the Finance Act, 1994 not imposable on them. Also, since they were under provisional assessment, the demand, if any, could have been taken care of at the time of finalization. Hence, they contended that the penalty is liable to be set aside. 5. The Ld A.R. for the department reiterated the findings in the impugned order. He also contended that penalty imposable under section 76 of the Finance Act , 1994. 6. Heard both sides and perused the appeal records. 7. We observe that the issue involved in the present appeal is related to the leviability of service tax on the amount paid to foreign insurance companies for reinsurance as well as on the amount received by them from other insurance companies in the domestic sector during the period May 06 to March-08. The department contended that the Appellant paid re-insurance premium to foreign based companies, but did not pay service tax in terms of Rule 2(i)(d)(iv) of the service tax rules, 1994. They were also liable to pay service tax on the reinsurance premium collected from mother insurance companies. 8. We observe that w.e.f. 01.05.2005, insurer includes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... observe that the decisions cited by the Appellant supports their view that penalty under section 78 of the Finance Act, 1994 not imposable when they acted on the bon fide belief that no service tax was payable on re-insurance premium paid. We observe that reinsurance premium was liable to service tax only w.e.f.01.05.2005 when the definition was amended to include re-insurer also as insurer. Thus, there were some confusion regarding payability of service tax on the re-insurance premium paid to foreign insurance companies. The issue became clear only after the issue of Taxation of Services (Provided from outside India and received in India ) Rules, 2006. After this, the Appellant has agreed their liability and paid service tax on the re-insurance premium paid by them to foreign companies. Thus, we observe that there was no intention to evade payment of service tax on the part of the Appellant. In such cases, no penalty imposable under Section 78 of the Finance Act, 1994. The following decisions supports this view: (a) C.C.I. Logistics Ltd. v. Commr. of CGST C.Ex., Kolkata North [2021 (54) G.S.T.L. 27 (Tri.-Kolkata)] 7.I find that penalty has been imposed by the authorities ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inally decided by the Hon ble Supreme Court in a landmark judgement in the case of Indian National Shipowners Associations. Moreover the appellant have paid the entire service tax even for the period prior to its levy ie.. before 18-4-2006 and the appellant have filed ST-3 returns wherein details of payments have been declared. In this fact we are of the view that demand for the extended period is not sustainable. We further find that the appellant alternatively claimed the benefit of section 73(3) of finance Act, 1994 on the ground that the entire service tax along with interest paid prior to show cause notice. Considering this position we are of the view that the demand for extended period is not sustainable hence the same is set aside. Demand for the normal period if any, is sustained along with interest. However, in the facts and circumstances of the case the penalties are not sustainable hence the same is set aside. Since we have considered appellant s submission on the point of Section 73(3) we are not going into other issue such as jurisdiction and taxability. (d) Commissioner of C.Ex., Chennai-I v. Chennai Petroleum Corpn. Ltd. [2007 (211) E.LT. 193 (S.C.)] 6. Ho ..... X X X X Extracts X X X X X X X X Extracts X X X X
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