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2015 (11) TMI 1604 - AT - Service TaxRecovery of interest under Section 75 of the Finance Act - imposition of penalty under Rule 7(C) of the Service Tax Rules, 1994 - payment of interest for delayed reversal of cenvat credit - Held that: - the credit taken inadvertently has not been utilized by the appellant for payment of service tax on the output services. In absence of non utilization of the irregularly availed cenvat credit, the same will be construed as a mere book entry, for which there is no loss of Revenue to the Government Exchequer. Interest is compensatory in character and the same is required to be paid when there is delay in payment of the principal amount. In the present case, since admittedly there is no delay in payment of service tax, I am of the view that provisions of Rule 14 of the Cenvat Credit Rules, cannot be invoked for payment of interest. I find force in the submissions of the Ld. DR for the Revenue with regard to imposition of penalty under Rule 7(C) of the Service Tax Rules, 1994 to the effect that filing of revised return should be considered as the date of filing of return for determination of the quantum of penalty. Considering the fact that penalty has been levied under Rule 7(C), I am of the view that imposition of penalty amount again under Section 77 of the Act is not proper and justified. Appeal allowed - decided partly in favor of appellant.
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