TMI Blog2018 (1) TMI 1271X X X X Extracts X X X X X X X X Extracts X X X X ..... er, the appellant has paid substantial amount of service tax prior to issuance of SCN - penalty u/s 78 set aside - demand of tax with interest upheld - appeal allowed in part. - ST/42072/2017 - 42469/2017 - Dated:- 26-10-2017 - Ms. Sulekha Beevi C.S., Member (Judicial) Ms. Radhika Chandrasekar, Advocate for the Appellant Shri Arul C. Durairaj, Superintendent (AR) for the Respondent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ovo adjudication, Order-in-Original was passed which is impugned herein whereby the Commissioner has confirmed the demand, interest and also imposed penalty of ₹ 11,62,249/- under section 78 of the Finance Act, 1994. Hence this appeal. 2. On behalf of the appellant, ld. counsel Ms. Radhika Chandrasekar submitted that the appellant is contesting only the penalty imposed. She pointed out th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... equired by the department. 3. Against this, the ld. AR Shri Arul C. Durairaj submitted that the appellant has discharged the service tax only after passing of the impugned order. That the entire demand of service tax of ₹ 11,62,249/- has not been discharged prior to issuance of show cause notice and therefore there can be no legal grounds for setting aside the penalty. Further, the show c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... de belief. Further, the appellant had agitated the issue of taxability of services upto the Tribunal by which the Tribunal had remanded the matter for reconsideration of the issue. This indicates that the appellant entertained a bonafide belief that their services are not leviable to service tax. On such score, I am of the view of that the penalty imposed under section 78 is unwarranted and the sa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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