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2015 (2) TMI 348 - AT - Service TaxImposition of penalty under Section 76, 77 & 78 - Delayed payment of service tax - revenue neutral situation - Malafide intention - whether the appellant was having any intent to evade payment of service tax - Held that:- in the case of Indian Oil Corporation Ltd. (2010 (8) TMI 800 - CESTAT MUMBAI) where the appellant after taking Cenvat credit on various inputs cleared as such to their other units indicated the duty payable. However, neither the duty was actually paid and nor the issue of such invoices was declared to the department, in that case it was held by this Tribunal that whatever duty they were to pay the credit of same is available to their sister unit. In such a situation of revenue neutrality, mala fide intention cannot be proved. Therefore, it was held that extended period is not invokable. Appellant has paid service tax along with interest on pointing out by the Revenue during the course of investigation and the appellant is entitled to Cenvat credit of serviced tax paid; in that situation intent to evade duty stands not proved. Consequently, the appellant is entitled for the benefit of Section 73 (3) of the Finance Act, 1994, as held by the Hon'ble Gujarat High Court in the case of Tejas Agency (2014 (8) TMI 151 - GUJARAT HIGH COURT) wherein it was held that it is not a case of non-payment of service tax with intent to evade the payment of same and therefore question of applying sub-section (4) of Section 73 of the Finance Act, 1994 and resultantly exclusion of application of sub-section (3) would not arise. In these circumstances, we hold that the appellant is entitled for the benefit of Section 73(3) of the Finance Act, 1994. Therefore, the show cause notice was not required to be issued. Consequently, the penalties confirmed in the impugned order as not required to be imposed on the appellant - Decided in favour of assessee.
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