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M/s. Cholamandalam MS General Appellant Insurance Co. Ltd. Versus Commissioner of Service Tax, Ltu, Chennai

2018 (2) TMI 832 - CESTAT CHENNAI

Penalty - CENVAT credit - sister units - case of appellant is that inasmuch as, they were sharing their services with their own sister Unit, they were under a bonafide impression that they are entitled to the entire service tax so paid, even though, a part of the tax was being collected from their sister Unit - Held that: - in the absence of any specific allegations and evidence to show that the appellant was availing the credit with malafide intention, their plea of bonafide needs acceptance. I .....

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Prabhu, For the Respondent: Shri Arul C. Durairaj, Supdt. ORDER Brief facts of the case are that the appellant is engaged in providing services of General Insurance Business, Insurance Auxiliary services, Business Support Services, Management and Business Consultants Services, Man-power Recruitment Service and Renting of Immovable Property Service. During verification of the documents of the appellant, it was noticed that the appellant and their sister Unit, namely, M/s. Chola Insurance Service .....

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es instead of availing their portion of service tax credit. Hence, a show-cause notice, dated 20.7.2012 was issued to the appellant proposing to demand the service tax amount collected from their sister Units to the extent of ₹ 15,85,863/- for the period from 2005-06 to 2009-10. After due process of law, the respondent vide the impugned order confirmed the entire service tax demand made under the extended proviso to section 73(1) of the Finance Act, 1994 and appropriated all the service am .....

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llant. The appellant had collected the proportionate amount including service tax from them for the common services, namely, Rent, Man-power Recruitment agent, Housekeeping, Electricity, Telephone etc., based on the utilisation of each unit. However, the appellant had availed full credit on the services instead of availing their portion of service tax credit. On being pointed out, the appellant paid the service tax involved on such services. Although, the appellant had paid the entire disputed s .....

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3) clearly states that when the tax and interest is paid in full, notice should be refrained from being issued and penalties should not be imposed, it must be noted that the section 73(4) of the Act states as follows: 73(4) Nothing contained in sub-section (3) shall apply to a case where any service tax has not been levied or paid or has been short-levied or short-paid or erroneously refunded by reason of - (a) fraud; or (b) collusion; or (c) willful mis-statement; or (d) suppression of facts; o .....

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