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2012 (12) TMI 792 - CESTAT AHMEDABADReverse charge - revenue neutral - extended period of limitation - External Commercial Borrowings (ECB) under "Banking and Other Financial Services" - Liability to pay Service Tax - Held that:- Appellants were eligible for CENVAT credit for the amount paid as Service Tax and, therefore, this is a situation which was revenue neutral and by not paying the Service Tax immediately, appellants have lost more than Rs.26,00,000/- paid by them as interest which would not have become payable if Service Tax was paid promptly and taken as credit. No service recipient would evade payment of Service Tax and become liable to pay interest which cannot be taken as credit. Therefore, it cannot be said that there was mis-declaration or suppression in the action of the appellants rendering them liable to penalty under various Sections of the Finance Act, in view of the fact that the demand itself is time barred since extended period could not have been invoked. Since appellants are not contesting demand for Service Tax and interest paid by them, the confirmation of demand for Service Tax and interest thereof has to be upheld as not contested and penalties have to be set-aside - appeal is allowed to the extent of penalties imposed under various sections which are set-aside.
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