TMI Blog2013 (1) TMI 547X X X X Extracts X X X X X X X X Extracts X X X X ..... the extension of CENVAT credit scheme to the service tax sector, this position changed and the Board again clarified the matter vide Circular dated 23/08/2007. Therefore, it cannot be alleged that the sub-contractor was not discharging service tax liability deliberately with an intention to evade service tax. That was the reason why the lower appellate authority has dropped the penalty proceedings against the appellant subject to their payment of service tax along with interest thereon by invoking the powers u/s 80. I do not find any infirmity in the lower appellate authority's order. In favour of assessee - ST/584/2012 - A/266/2012/SMB/C-IV - Dated:- 5-9-2012 - P.R. Chandrasekharan, J. Appellant Rep by: Shri M.S.Reddy, As ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nsidering the submissions made before him, set aside the penalties imposed, subject to the appellant remitting the service tax along with interest, by invoking the provisions of Section 80 of the Finance Act, 1994 and holding that the appellant was having a reasonable belief that once the main contractor discharged service tax liability, the appellant being a sub-contractor need not pay the service tax. The Revenue is aggrieved by this decision of the appellate authority with regard to dropping of the penalties imposed on the appellant and hence they are in appeal before me. 4. The learned Assistant Commissioner (AR) appearing for the Revenue submits that the appellant having collected the service charges from the service recipient, would ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as been held that once the main contractor has discharged the service tax liability on a value which includes service provided by the sub-contractor, then the demand for service tax on sub-contractor is not sustainable in law. In the instant case, though the appellant is not disputing their service tax liability along with interest and have paid the same, nevertheless the ratio of these decisions would apply. Once the demand for service tax itself is not sustainable for the period, consequential penal liability will not follow, and therefore, the decision of the lower appellate authority in dropping the penal proceedings is correct in law and accordingly has to be sustained. 6. I have carefully considered submissions made by both the side ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
