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2014 (12) TMI 1090 - AT - Service TaxPenalty u/s 77 & 78 - Payment of service tax as recipient of service - Held that:- Appellants did not to pay service tax in cash as they were entitled to avail Cenvat credit and the same was utilised. In such a situation, there was no need for the appellant to evade tax. When there is no need to evade tax, extended period could not have been invoked. In these circumstances, the penalty under Section 78 of the Act which is to be imposed when there is an intention to evade duty or suppression, fraud or collusion, mis-declaration etc. could not have been imposed. Accordingly, penalty under Section 78 of the Act is set aside. Coming to the penalty under Section 77, this penalty has been imposed for non-filing of returns. It is quite clear that the appellant has failed to file returns. Therefore, the penalty imposed under Section 77 of the Act is sustainable and the same is sustained. - Appeal partly allowed.
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