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2021 (10) TMI 702 - AT - Service TaxLevy of service tax - service to financial institutions in relation to selling of their loan products to their customers - taxability of commission as received by the appellant in terms of sub section 19 of 65 of Finance Act or not - imposition and quantum of penalty - HELD THAT:- The services being rendered by the appellant are defined under section 65(19) of Finance Act, 1994. When the provision is read with section 68 thereof, it becomes clear that service was taxable and the appellant was liable to pay the service tax. There has been a major change in Finance Act with effect from 01.07.2012 by virtue of negative list under section 66B of the Act was provided. It was held that the services which are not covered under the said list are taxable. Apparently, the services of DSA to Financial institute is not mentioned in the said negative list nor any exemption for the same is brought to the notice. The appellant did not get himself registered immediately after 01.07.2012. He applied and got registration only in August, 2016 when the services were under scrutiny by Income Tax department. It is abundantly clear that the appellant was providing taxable service which is chargeable to service tax in terms of section 66B of the Finance Act, 1994. The appellant cannot be allowed to plead ignorance of law. Otherwise also the said liability has not been contested by the appellant as the entire demand stand already deposited that too without protest. Levy of penalty - HELD THAT:- Irrespective of the fact that the appellant has paid the amount demanded along with the interest within 30 days of the issuance of show cause notice but same does not absolve him from imposition of penalty. 15% of the penalty has still to be paid by the appellant in terms of proviso to Section 78 of the Service Tax Act, 1944 - No doubt the said amount also stands already paid. in terms of proviso to section 78 of the Finance Act, proceedings against the appellant be deemed to be concluded - penalty is directed to remain confined to 15% of the total demand instead of it being @ 100% of the amount of demand. Appeal allowed in part.
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