2010 (9) TMI 930 - AT - Service Tax

Summary

Issues involved: Imposition of penalty under Section 78 of the Finance Act for providing canteen service to National Institute of Bank Management.

Summary:
The appellant filed an appeal against the penalty imposed under Section 78 of the Finance Act for providing canteen service to the National Institute of Bank Management. The appellant contended that they were under a bona fide belief that they were not providing any taxable service as per their agreement with the Institute. The Revenue argued that the appellant admitted their default and paid the service tax, making them liable for the penalty. The Tribunal examined the agreement between the parties and referred to a previous case to determine that the appellant's activities did not fall under outdoor catering service. Considering the provisions of Section 80 of the Finance Act, the Tribunal found merit in the appellant's contention and set aside the penalty imposed under Section 78, allowing the appeal.