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2016 (9) TMI 539 - AT - Service TaxLevy of interest alongwith penalty - Section 75 and 77(2) of Finance Act, 1994 - tax liability not been fastened on the appellants - administrative charges received from the client - differential service tax paid after pointing out by the department - treatment of payment made as voluntarily or under protest - Held that:- the show cause notice proposes to recover interest under Section 75 and penalty under Section 77(2) on the amount already paid by the appellant. Section 75 can be invoked only when the person liable to pay service tax in accordance with the provisions of Section 68 has not credited the same. I find that the appellants herein are contesting the demand and have paid the amount only on being pointed out by the department during audit. I find that there is no allegation in the Show Cause Notice to demand or appropriate the amount paid by the appellants. I also find that the finding of the adjudicating authority that the appellants had not disputed the tax liability is also not correct. Hence the demand of interest under Section 75 cannot be fastened on the appellants. Accordingly, penalty under Section 77(2) also fails. Invokation of extended period of limitation - period of dispute is from October 2006 to July 2008 - Show Cause Notice was issued only on 06.08.2010 - Held that:- the Show Cause Notice does not invoke provision of Section 73 to invoke the extended period of limitation and the case of the department fails on that ground alone. it is found that there has been no deliberate action on the part of appellants to invoke larger period and the department was well aware of the activities of the appellants. - Decided in favour of appellant
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