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2015 (12) TMI 948 - AT - Service TaxImposition of penalty - benefit of u/s 73(3) - Construction service - Held that:- Provisions of Section 73(3) of the Finance Act, 1994 as were in the statute during the relevant period when the show-cause notice dated 16.10.2009 issued needs to be considered; as appellant have discharged the entire service tax liability along with interest as has been ascertained by the Central Excise Officers i.e. audit party. In our view, provisions of Section 73(3) very clearly lays down that if service tax liability and the interest thereof is discharged on the direction of the Central Excise Officers, there is no need to issue show-cause notice. Adjudicating authority should have applied these provisions in the case in hand. We find a strong force in the contentions raised by the learned Counsel that they were under bonafide belief that the construction activity which was undertaken by the appellant was in respect of Government appointed statutory body hence tax liability may not arise. In our view the appellant could have entertained a bonafide belief that the activity undertaken by the appellant may not be covered under the tax net. In our considered view, this is a fit case for invoking provisions of Section 80 of the Finance Act, 1994. By invoking the said provisions of Section 80 of the Finance Act, 1994, we set aside the penalties imposed by the adjudicating authority under various sections - Appeal disposed of.
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