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2023 (10) TMI 386 - CESTAT CHENNAILevy of penalty - Issuance of SCN - Service tax along with interest paid before issuance of SCN - delay in payment occurred only on the understanding and accounting with regard to the new amendment which was brought forth with effect from 10.05.2008 - HELD THAT:- The appellant has paid up the service tax along with interest much before issuance of show cause notice. There was also an issue of irregularly availed cenvat credit. The appellant has paid up this amount also along with interest. The show cause notice itself shows that the amount paid up by the appellant is to be appropriated. In such circumstances, as per sub- section (3) of Section 73 of the Finance Act, 1994, the department ought not to have issued any show cause notice. Further, it can also be seen that the delay in payment of service tax was due to transition / amendment that was brought forth w.e.f. 10.05.2008 with regard to the liability to pay service tax on book adjustment by Associated Enterprises. As the appellant has paid up the entire amount of service tax / wrongly availed cenvat credit along with interest much before issuance of show cause notice, it is opined that as per sub-section (3) of Section 73 of the Finance Act, 1994, no show cause notice ought to have been issued to the appellant. The penalty imposed on the appellant under Section 77, 78 of the Finance Act, 1944 and under Rule 15 of CCR 2004 therefore requires to be set aside. The impugned order is modified to the extent of setting the penalties imposed without disturbing the confirmation of service tax, interest and the appropriation thereof - appeal disposed off.
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