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2018 (1) TMI 1462 - SETTLEMENT COMMISSION, CUSTOMS, CENTRAL EXCISE AND SERVICE TAX, CHENNAINon-payment of service tax - manpower recruitment and supply agency service - it was alleged that consideration in respect of services provided, though Service Tax was claimed and received by the applicant, they had not declared the actual service consideration in the periodical statutory ST3 returns - POT Rules - N/N. 30/2012-ST., dated 20-6-2012 - Applicant contended that they were totally new to business segment and not well-versed with the rules and regulations. Held that:- The Bench finds there is considerable force in the argument put forth by the Commissioner. Even though the Service Tax was wrongly paid by the Service recipients, instead of the Service provider, i.e. the Applicant, and even accepting that the wrong payment had happened under mistake of law, the fact remains that Service Tax was short paid by the Service provider vis-a-vis the value determined by them under Section 67 of the Finance Act, 1994. Ignorance of law cannot be pleaded as an excuse for not fulfilling the statutory fiscal obligations. If the Service recipients had paid Service Tax, which they need not have paid, it was for them to approach the proper authority and seek refund - Payment of Service Tax by the service recipients of the Applicant cannot extinguish the liability cast on the Applicant. The Bench is of the view that the Applicant is required to pay an additional Service Tax of ₹ 6,70,831/-. The Bench, thus, settles the Service Tax liability at ₹ 80,30,602/- (Rs. 80,22,513 + ₹ 8,089/- (not covered in the Show Cause Notice, but accepted by the Applicant and paid). The Applicant, having paid ₹ 73,59,771/- (Rs. 73,51,682/- + ₹ 8,089/-), is required to pay the remaining amount of ₹ 6,70,831/-. Liability of Interest - Held that:- As the Applicant is required to pay an additional amount of ₹ 6,70,831/- towards Service Tax, the quantum of interest payable shall vary and the Applicant shall work out the revised interest liability to the satisfaction of the Jurisdictional Commissioner. Penalty - Held that:- It has to be construed that the Applicant had failed to discharge the statutory obligations and their act entails penalty, as proposed in the show cause notice - The Co-Applicant also becomes liable to penalty, as proposed, inasmuch as the contracts entered into by the Applicant had explicit mention about the taxability of services rendered and he was responsible for declaring the correct taxable service consideration to the department, which had not been done - However, the Bench observes that the Applicant had made a full and true disclosure and had paid all the Service Tax dues with interest, barring a small disputed portion. The Applicant had also cooperated with the department and the Settlement Commission during the proceedings, which act makes a case for the Applicant and the Co-Applicant for grant of partial waiver from penalty - part penalty waived. Prosecution - Held that:- The Bench considers it a fit case for grant of immunity from prosecution to the Applicant and Co-Applicant. Application disposed off.
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