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2011 (3) TMI 153 - CESTAT, CHENNAIPenalty u/s 77 and 78 - The appellant were required to pay service tax as recipient of services in respect of commission paid to foreign agents effective from 18.04.06 - This they paid only on being pointed out by the department - They have paid the entire service tax before the issue of show cause notice and the interest involved before adjudication by the original authority - It is not in dispute that as recipient of services, the appellant-assessees were entitled to take credit of the service tax paid by them - Therefore, their plea that in the light of provisions of EXIM Policy, they were under bonafide belief that they were not liable to service tax has to be deserves to be accepted especially in the light of the eligibility of cenvat credit of entire service tax paid by them - Hence,no penalty needs to be sustained - The appeal of the department seeking enhancement of penalty is rejected.
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