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2016 (11) TMI 141 - CESTAT BANGALOREImposition of penalty u/s 78 of Finance Act, 1994 - Manpower Recruitment and Supply Agency Service - import of services from the foreign companies - levy of tax on import of service u/r 2(1)(d)(iv) of the Service Tax Rules, 1994 - Sections 73, 76 & 78 of the Finance Act, 1994 - suppression of facts - Held that: - Section 73(3) is very clear as it says that if tax is paid along with interest before issuance of the show-cause notice, then in that case, show-cause notice shall not be issued. In this case, I find that the contention of the appellant that he bonafide believed that he is not liable to pay service tax but during the audit, the audit party informed him that he is liable to pay service tax, then he immediately paid the entire service tax along with interest. Except mere allegation of suppression, the Department did not bring any material on record to prove that there was suppression and concealment of facts to evade payment of tax. Consequently, in my opinion, the imposition of penalty under Section 78 of the Act is not justified and bad in law. Moreover, in the impugned order, the learned Commissioner (Appeals) has not recorded any finding on suppression of facts by the appellant with an intention to evade tax - penalty set aside - appeal allowed - decided in favor of appellant.
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