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2016 (11) TMI 1229 - AT - Service TaxLevy of penalty u/s 76 and 78 of the Finance Act, 1994 - taxability of Sale of Space or Time for Advertisement - Service Tax was introduced on the said category with effect from 01.5.2006 - doubt as regards taxability of the service - section 80 - whether imposition of the appellant u/s 76 and 78 of the FA, 1994 needs to be upheld or the Appellant made out a case for invoking of Section 80 of the FA, 1994? - Held that: - the appellant sought opinion from the reputed Chartered Accountant ie., M/s Talti & Talati with regard to the liability of the Service Tax on “Sale of Space or Time for Advertisement” levied for the first time with effect from 01.5.2006. On receiving a categorical opinion of non-applicability of Service Tax, they did not discharge the Service Tax. However, subsequently, on further inquiry from other sources/consultants they realized their mistake and discharged the entire amount of Service Tax alongwith interest on 05.7.2007 pertaining to the period of 01.5.2006 to 30.6.2007. Their Claim is that this argument even though advanced before the authorities below, but not considered. I find that undisputedly, the appellant is a public sector undertaking and also the amount of Service Tax due for the period of 01.5.2006 to 30.6.2007 has been paid by them after realization of the fact that the service rendered by them become leviable to service tax w.e.f 01.05.2005. Initial non payment of tax was due to a bonafided mistake and the mistake was attributed to the opinion rendered by a reputed Chartered Accountant firm M/s Talati & Talati. Thus, in my opinion, the reasons cited by the appellant for their initial failure to discharge Service Tax during the said period seems to be reasonable warranting invocation of Section 80 of the FA, 1994 - penalty set aside - appeal allowed - decided in favor of appellant-assessee.
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