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2015 (4) TMI 1111 - AT - Service TaxEntitlement for refund - 25% of penalty imposed paid in respect of adjudication order which was waived by the Commissioner (Appeals) in its order- Commercial or industrial construction service - Department submitted that once the assessee exercises the option of payment of 25% of the penalty, he deemed to have accepted the demand of Service tax made under Proviso to Section 73 of the Finance Act, 1994 and penalty under Section 78 ibid and therefore the assessee cannot take recourse of filing appeal for setting aside the penalty. Held that:- no legal provision is found which provides that once an assessee pays the entire demand with interest and penalty to the extent of 25% of the Service tax demanded, cannot challenge either the liability of Service tax and interest or penalty alone and the matter has to be treated as closed. No doubt, there is an instruction issued by the Board that once the assessee pays the Service tax and interest and intimates the department of the same on the basis of assessment of tax liability of the Central Excise Officer no show cause notice for differential amount of Service tax or interest can be demanded after one year except where there is a case for invoking suppression of facts, misdeclaration, fraud, etc. Further, there is no law laid down anywhere that the matter has to be considered as settled when an assessee pays the tax demanded with interest and penalty in accordance with law. It is only provided in the case of Settlement Commission where the Settlement Commission decides the issue and amounts as per the Settlement Commission are paid by the assessee, he has no right to challenge. I am not dealing with the decisions of Settlement Commission but decision of the adjudicating authority which was considered by the learned Commissioner (Appeals). - Decided against the revenue
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