Home Case Index All Cases Service Tax Service Tax + AT Service Tax - 2019 (2) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2019 (2) TMI 1311 - AT - Service TaxPenalty u/s 78 of FA - Tax paid on being pointed out - Appellant also willing to deposit the amount of interest u/s 75 ibid - no suppression of facts - construction services - amendment in the provisions - lot of confusion amongst the builders - Held that:- The provisions under Section 11AC of the Central Excise Act, 1944 and Section 78 of the Finance Act, 1994, are pari materia - In the matter of Rajasthan Spinning and Weaving Mills [2009 (5) TMI 15 - SUPREME COURT OF INDIA] the Hon’ble Supreme Court has laid down that unintentional and bona fide non-payment of duty does not entail penalty under Section 11AC of the Act of 1944 - Similarly, in the matter of Commissioner of Central Excise, Vapi v. Kisan Mouldings Limited [2010 (9) TMI 451 - SUPREME COURT OF INDIA], following the ratio of Rajasthan Spinning and Weaving Mills case, the Hon’ble Supreme Court has held that since it is a case of bona fide mistake and there was no intention to evade tax by the respondent, penalty was rightly not imposed. Thus, it is quite vivid that presence of mens rea is absolutely necessary ingredient for imposing penalty under Section 78 of the Finance Act, 1994, as laid down by the Hon’ble Supreme Court - In the present matter, the Appellants were under a bona fide belief that they were not liable to pay Service Tax for construction services. The conduct of the appellant of prompt payment of Service Tax immediately after gaining knowledge about its liability to pay Service Tax, is sufficient reason to believe that the appellant did not have an intention to evade the payment of Service Tax. Therefore, considering the overall facts and circumstances of the case, while upholding the interest liability u/s.75 ibid, Section 80 ibid can be invoked for waiver of penalty imposed on the appellant. Penalty set aside - appeal allowed - decided in favor of appellant.
|