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2019 (3) TMI 420 - AT - Service TaxImposition of penalty u/s 78 of FA - service tax along with interest paid on being pointed out - suppression of facts or not - Held that:- The Revenue has failed to bring any evidence to show that the appellant had in fact indulged into the activities of fraud, collusion, willful mis-statement, suppression etc. with intent to evade payment of service tax. On the contrary it is admitted fact that the service tax liability is not disputed by the Appellant and the same has been discharged with applicable interest, for delayed payment, much more before the initiation of proceedings. Mens rea has to be proved for invoking the extended period of limitation and also for imposing penalty under Section 78 of the Finance Act, 1994. Mere inaction to declare what was supposed to be declare d under the law does not lead to suppression of facts. Similarly, mere non-payment of short- payment of duties or taxes cannot be construed as with an intent to evade duties/taxes. There must be something more than mere failure to pay taxes for invoking the provisions of Section 78 ibid. The appellant has shown their bona fide by paying the service tax alongwith interest thereon immediately admitting their unintentional lapse - the authorities below have failed to brought on record any evidence to prove suppression or mala fide intention on the part of the appellant and, therefore, no case has been made out for invoking the provisions of Section 78 ibid - penalty set aside - appeal allowed - decided in favor of appellant.
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