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2019 (7) TMI 336 - AT - Service TaxImposition of penalty - requirement of mens rea to impose penalty - Commissioner (Appeals) had confirmed the penalty through a different logic by borrowing Hon'ble Supreme Court observations made in UNION OF INDIA AND OTHERS VERSUS DHARMENDRA TEXTILE PROCESSORS AND OTHERS [2008 (9) TMI 52 - SUPREME COURT] - HELD THAT:- Considering the fact that appellant had placed his reliance on the statement of its own manager recorded by the respondent-department where the only plea taken by the appellant was financial difficulty in not registering the firm despite the fact that show-cause notice revealed huge turnover of ₹ 2,46,97,756/- for providing temporary accommodation service to the customers, paucity of funds cannot be a ground for non-registration of the firm. Further, as per Section 58 of the Indian Evidence Act, admission needs no further proof and when appellant admits through the statement of its manager that Service Tax was not paid and Service Tax registration was not obtained with its full knowledge, the same would establish a clear case of suppression against the appellant. The duty on room service charges at a reduce calculated rate along with interest under Section 75 of the Finance Act, 1994 and penalty imposed under Section 78 of the Finance Act, 1994 was rightly involved - having regard to the first proviso which was effective from 04.04.2011 till the effective date of implementation of Finance Bill of 2015 which is admittedly effective after April 2015, appellant is liable to pay 50% of the duty demand as penalty since the duty assessment was done only on the basis of records maintained by it. Appeal allowed in part.
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