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2018 (2) TMI 1249 - Commission - Service TaxConstruction Service other than residential complex, including Commercial/ industrial buildings or civil structures - the applicant had filed ST-3 Returns for Construction service, but the Service Tax was paid for Works Contract Service - N/N. 30/2012-S.T., dated 20-6-2012 read with Rule 2(d) of the Service Tax Rules, 1994 - reverse charge mechanism - demand of interest and penalty. Held that: - Even though initially a portion of the tax was wrongly paid by the Service recipient, instead of the Service provider, i.e. the applicant, and even accepting that the wrong payment had happened by mistaken understanding of the legal position, the fact remains that Service Tax was short paid by the Service provider vis-ä-vis the value determined by them under Section 67 of the Finance Act, 1994. It is also an admitted fact that the applicant had raised bill on the Service recipient charging 100% of the applicable rate of Service Tax. Having charged Service Tax at 100% and paying only 50% of the tax to the Government clearly establishes short payment by the Service provider, attracting interest. It is only a case of excess payment of tax by a different assessee, dealt according to the provisions of law governing refund/ adjustment and it cannot be linked with the case on hand. Hence, the Bench holds that interest is chargeable from the date on which the Service Tax became payable by the applicant, as alleged in the show cause notice and as contended by the jurisdictional Commissioner. The Bench, thus, settles the Service Tax liability and interest liability at ₹ 81,59,255/- and ₹ 14,61,006/respectively. Penalty - Held that: - This is a case of short payment of Service Tax. Though the sequence of events suggest that the short payment had occurred out of mistaken understanding of the legal position by the Service recipient, the applicant had not disclosed the above facts of short payment till the unit was audited by the officers of the Department. Nevertheless, the applicant had paid short of the appropriate Service Tax and the short payment had come to the notice only on verification by the Audit. The applicant has not suo moto informed the position to the Department - Considering the fact that misunderstanding of the provisions of Notification had led to the short payment of Service Tax and the applicant had made good the short payment on being pointed out, the applicant is entitled to partial waiver of penalty, which this Bench is inclined to consider. Hence, the Bench grants partial waiver from penalty to the applicant. The Bench considers it a fit case for grant of immunity from prosecution to the applicant - The immunities are granted in terms of Section 32K of the Central Excise Act, 1944, as made applicable to Service Tax matters vide Section 83 of the Finance Act, 1994. If the applicant fails to pay the sum ordered as above, the immunity granted shall stand withdrawn. Appeal disposed off.
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