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TMI Blog2024 (10) TMI 455X X X X Extracts X X X X X X X X Extracts X X X X ..... prior to the payment of the service tax on the import of services availed by them on reverse charge basis. There was a delay of 3 days in respect of payment of service tax after taking credit in the month of April and 7 days in the month of November 2007. The dates of availing the CENVAT credit were 30.04.2007 and 30.11.2007 whereas the dates of actual payment of service tax on reverse charge basis were 03.05.2007 and 06.12.2007 respectively. It is noticed that on being pointed out, the Appellant have paid the applicable interest. So, we do not find any justification for imposing mandatory penalty for such a clerical mistake committed in availing the CENVAT credit before the payment of the service tax. It is not that the Appellant has take ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion 78 of the Finance Act, 1994 is not justified and so ordered to be set aside. However, the appropriation of the tax and interest paid not disturbed. Appeal allowed. - HON BLE MR. P. DINESHA , MEMBER ( JUDICIAL ) And HON BLE MR. VASA SESHAGIRI RAO , MEMBER ( TECHNICAL ) For the Appellant : Mr. S. Durairaj , Advocate For the Respondent : Ms. O. M. Reena , Authorised Representative ORDER Order : - Per Mr. VASA SESHAGIRI RAO M/s. Hyundai Engineering India Pvt. Ltd. (the Appellant herein) have filed this appeal No. ST/40152/2024 against the Order-in-Appeal No. 08/2017-2018(Audit-1) dated 18.01.2018 passed by the Commissioner of Central Tax (Appeals-II), Anna Nagar, Chennai who have imposed a penalty of Rs.63,58,370/- under Rule 15 of CENVAT ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the interest applicable for availing the CENVAT credit of service tax paid on reverse charge basis prior to its actual payment amounting to Rs.9,350/- on 18.07.2009. As the Department was of the view that the Appellant has contravened the provisions of CENVAT Credit Rules, 2004, with an intention to evade tax, the Show Cause Notice No. 191/2010 dated 15.04.2010 was issued proposing to recover CENVAT credit of service tax availed under Rule 14 of CCR, 2004 read with proviso to Section 73(1) of the Finance Act, 1994, along with interest and also proposing penalty under Rule 15(4) of CCR, 2004 read with Section 78 of the Finance Act, 1994. After due process of the law, the Show Cause Notice was adjudicated by the Additional Commissioner vide h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m the records of the appeal, it is evident that the Lower Adjudicating Authority have concluded that the Appellant have intentionally taken the CENVAT credit to make the monthly payments, even before the actual payment of service tax and that the appellant has not brought to the notice of the Department nor paid the interest though committed the same irregularity twice in the months of April 2007 and November 2007 till it was pointed out by the CERA Audit. He has also referred to the fact that the Assessee was working under self-assessment scheme and is under obligation to follow the provisions of the law and procedures prescribed in utilization of CENVAT credit for invoking larger period of limitation. 4. The Ld. Authorised Representative ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oticed that on being pointed out, the Appellant have paid the applicable interest. So, we do not find any justification for imposing mandatory penalty for such a clerical mistake committed in availing the CENVAT credit before the payment of the service tax. It is not that the Appellant has taken the credit without payment of the service tax. There were only a few days delay in payment of tax after taking the credit. As the interest has been paid soon after Audit objection, we find that there is no need to issue any Show Cause Notice or for imposition of mandatory penalty in terms of Section 73 of the Finance Act, 1994 which reads as under : - (3) Where any service tax has not been levied or paid or has been short-levied or short-paid or err ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Having considered the facts and circumstances, we find that there is no allegation of fraud or suppression, save and accept, that had the audit, not taken notice of the errors in the computation of taxes, the same would have gone unnoticed. Further, we find from the facts on record that the appellant have deposited almost all the taxes with interest before issue of the show cause notice, without any protest. In this view of the matter, we find that there is no condition precedent under Section 78 available and accordingly, we allow the appeal and set aside the penalties. 10. In this appeal, even there is no allegation that the Appellant has taken the CENVAT credit without payment of the service tax on reverse charge basis. There was only f ..... X X X X Extracts X X X X X X X X Extracts X X X X
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