TMI Blog2014 (8) TMI 923X X X X Extracts X X X X X X X X Extracts X X X X ..... penalties imposed on the appellant under section 78 of Finance Act 1994 as recorded that the adjudicating authority has not recorded any findings on the imposition of penalty under section 78. This itself would reinforce the argument of the appellant that they were under bonafide belief that the service tax liability does not get attracted. We find strong force in the of contention raised by the Ld. Counsel that the appellant had never collected the amount of service tax liability from the service recipient though the bills were raised for the service rendered - appellant could have entertained a bonafide belief that the service rendered by him may not be taxable. We are of the view that the appellant had made out a reasonable cause for set ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rship of club or Association' under Section 73(1) ibid. He imposed penalty of ₹ 1,43,477/- under Section 78 ibid. Penalty of ₹ 2000/- under section 72(2) ibid and penalty as prescribed under section 77(i)(a) ibid for failing to obtain registration. 2. Aggrieved by such an order, assessee preferred an appeal before the first appellate authority. Before the first appellate authority, they did not dispute the service tax liability and interest thereof, contesting only penalties imposed on the ground they had bonafide belief that the service rendered by them are not taxable and they did not collect any service tax from the service recipients. The revenue was also aggrieved by the OIO for non-imposition of penalty under sectio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... trong force in the of contention raised by the Ld. Counsel that the appellant had never collected the amount of service tax liability from the service recipient though the bills were raised for the service rendered. 5. In the peculiar facts and circumstances of this case, we find that the appellant could have entertained a bonafide belief that the service rendered by him may not be taxable. We are of the view that the appellant had made out a reasonable cause for setting aside the penalties imposed on him under section 76 and 77 of the finance act 1994. 6. Accordingly, in view of the foregoing, we invoke the provisions of section 80 of the Finance Act 1994 and set aside the penalties imposed on the appellant under section 76 and 77 of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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