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2019 (11) TMI 492 - AT - Service TaxLevy of service tax - pre-closure charges of loan account - locker rent charges - appellant is a banking institution - period 2005-06 to 2009-10 - HELD THAT:- On pre closure charges of loan account, it is found that the Ld. Counsel made a concession that he is not contesting on merit. Therefore, demand for the normal period stands upheld. Time limitation - penalty - HELD THAT:- There is a force in the argument of the Ld. Counsel that the issue is not free from doubt as regard the pre closure charges will attract service tax or otherwise. Since there are conflicting judgments of this Tribunal in the case of Small Industries Development Bank of India (SIDCO) and Housing and Urban Development Corporation Ltd. (HUDCO), [ 2011 (11) TMI 95 - CESTAT, AHMEDABAD ] the matter was referred to larger bench. In this position, we observe that there is no malafide intention on the part of the appellant. Therefore, the demand for the extended period is not sustainable and the same is set aside. For the same reason, the penalty imposed under section 76 & 78 is also set aside by invoking section 80 of the Finance Act, 1994. Locker rent charges - HELD THAT:- Though the locker rent charges was included in the service of Banking and Financial service and other services with effect from 10/09/2004, however, by virtue of notification 25/2004-ST, the value of locker rent charges received prior to 10/09/2204 is exempted - There is no dispute that the entire amount on which the Service Tax demand was raised was received prior to 10/09/2004 as can be seen in OIO. In this position, there is no doubt that amount being received prior to 10/09/2004 towards locker rent charges is covered by the exemption notification 25/2004-ST - the demand on locker rent charges is set aside. Appeal allowed in part.
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