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2022 (9) TMI 903 - KARNATAKA HIGH COURTLevy of penalty - suppression of facts or not - Non/Delayed payment of service tax - Cenvat credit wrongly taken on account of clerical mistakes or not - suppression can be alleged merely on audit objections or not - Service Tax with interest paid before the issue of Show Cause Notice - applicability of benefit of Section 73(3) of the Finance Act, 1994 - whether payment of service tax, which was not made by the assessee falls within the conditions prescribed in the Act? - HELD THAT:- The assessee has given two reasons for non-payment. Firstly, that it had occurred due to clerical mistake committed by the employee, who was handling the service tax and he had passed away. Secondly, that the Finance Manager had also resigned. These reasons have been accepted by the CESTAT. It is relevant to note that upon being pointed out during the audit, the assessee has promptly made the payment of tax with interest and requested not to issue any show-cause notice. In order to reverse the decision of the CESTAT, nothing is pointed out from the record to demonstrate that there was either fraud or collusion or willful mis-statement or suppression of facts or contravention of any of the provisions of the Act and Rules. In the absence of the conditions contained in Section 78 of the Finance Act, the imposition of penalty is not sustainable. Hence, no interference is called for with the impugned decision of the CESTAT - appeal dismissed.
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