TaxTMI 
TaxTMI 
2014 (9) TMI 748
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....t penalty or not. 4. Learned counsel would submit that appellant had discharged the entire service tax liability and interest thereof before issuance of show cause notice and is not disputing. It is his submission that subsequently on receipt of order-in-original, they have discharged 25% amount of penalty imposed under Section 78 and also penalty under Section 77 but contested the imposition of penalty under Section 76 before the first appellate authority. It is his submission that first appellate authority has not considered the judgment of the Hon'ble High Court of Gujarat in the case of Commissioner of Service Tax vs. Manan Motors Private Limited - 2013 (31) STR 535 (Guj) wherein their Lordships have upheld the judgment of the Tribunal....
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.... High Court of Gujarat in the case of Manan Motors Private Limited would squarely apply. In the said case of Manan Motors, the Hon'ble High Court was considering the very same provisions as to imposition of penalty in excess of 25% of the service tax liability under Section 76 or 78 of the Finance Act, 1994. With respect I reproduce the relevant paragraphs:- 3. In pursuance of the show cause notice dated 22-10-2008, the Joint Commissioner, Service Tax, passed an order on 12-11-2009 wherein demand of Rs. 7,68,602/- was confirmed along with interest in terms of Section 75 of the Act and penalty of Rs. 200/- per day or at the rate of 2% of the Service Tax amount per month under Section 76....
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....uld require to deposit the penalty as he would have known as to what penalty would be levied on the assessee, therefore, at least he should have deposited the 25% of the penalty amount within thirty days. We do not agree with the argument of learned counsel for the appellant as the Board's Circular dated 3-10-2007 in paragraph No. 3.1 has considered the proviso to Section 73 that where a person has paid service tax in full together with interest and penalty under sub-section (1A), the proceedings in respect of such person to whom notices are served under sub-section (1) shall be deemed to be concluded. In the instant case was not contesting the Service Tax liability and had deposited the entire service tax and interest much before the issua....