TMI Blog2014 (9) TMI 253X X X X Extracts X X X X X X X X Extracts X X X X ..... NATAKA HIGH COURT] Karnataka and in CST, Banglore vs. Ahead Info Technologies India Pvt. Limited - [2014 (8) TMI 785 - KARNATAKA HIGH COURT]. In these pronouncements, the Karnataka High Court enunciated the principle that where an assessee has paid both the service tax and interest before issuance of a show cause notice under the Act, subsection 3 of section 73 of the Act, prohibits initiation of proceedings for recovery of penalty. When there is a finding of fact that this was not a case of non-payment of Service Tax with intent to evade the payment of the same, question of applying Subsection (4) of Section 73 of the Finance Act, 1994 and resultantly exclusion of application of Subsection (3) thereof, would not arise. - no penalty - de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation of the submissions made by both sides and perusal of the records, we find that the issue involved is regarding imposition of penalty on the appellant under Section 76 of the Finance Act, 1994 for belated payment of service tax liability. 5. It is undisputed that the appellant has discharged the service tax liability along with interest albeit belatedly and was done on his own. In our considered view, having discharged the service tax liability which is not modified by the lower authorities, the provisions of Section 73 (3) of the Finance Act, 1994 will come into play as there is no allegation in the show cause notice that there is an intention to evade payment of service tax liability. We find strong force in the contentions raised ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) suppression of facts; or (e) contravention of any of the provisions of this Chapter or of the rules made thereunder with intent to evade payment of service tax. 5. It is true that as per Subsection (4), penalty may still attach if there is non-payment of Service Tax by reason of fraud, collusion, wilful mis-statement, suppression of facts or contravention of provisions of the statute with intent to evade payment of Service Tax. In the present case, the Tribunal noted that,...Since the recipient company had claimed Cenvat credit on the service tax remitted by the assessee, eventually no liability was incurred by the service recipient and amount of service tax remitted by the assessee was also reimbursed by the recipient. Learned coun ..... X X X X Extracts X X X X X X X X Extracts X X X X
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