TMI Blog2018 (5) TMI 1466X X X X Extracts X X X X X X X X Extracts X X X X ..... Instructions dated 08.07.2016, the intention was to encourage voluntary compliance and introduce the consultation process for evading issuance of show cause notice. The situation in the present case is Revenue neutral as the duty was paid under reverse charge mechanism and the Cenvat credit would only be availed by the appellant himself - reliance placed in the case of Modern Woolens vs CCE, Jaipur-II [2016 (11) TMI 1353 - CESTAT NEW DELHI], where it was held that whatever Service tax was required to be paid by the appellant, was available to them as cenvat credit. As such, the entire situation is revenue neutral, in which case, no malafide can be attributable to the appellant. The imposition of penalty under Section 78 is not justif ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vice tax and interest thereon were confirmed under Section 73(2) and Section 75 respectively of the Finance Act, 1994. The adjudicating authority also imposed penalty equivalent to 50% of the amount of service tax confirmed under Section 78 of the Finance Act. Aggrieved from the same, the appellant filed this appeal. 2. Ld. Advocate for the appellant submits at the outset that they are not contesting the demand of service tax as well as demand of interest, which has been paid by them well before the issuance of show cause notice. He further submits that are only contesting the penalty imposed under Section 78. The contention is that they had paid the service tax on their own ascertainment voluntarily and also paid the interest thereon as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... had made delayed payment of duty on 4 occasions but at all the times, the delayed payment was made by them on their own ascertainment. The late payment was discovered by the Revenue during audit and when the appellant was asked to pay the interest for delayed payment, the appellant paid interest on the delayed payment. Both the amount of service tax due and interest amount were admittedly made before issuance of show cause notice which was issued 7 months after all dues have been cleared. The show cause notice alleges intention late payment of duty but the intent to evade is merely grounded on non-payment of interest. The Ld. Commissioner (Appeals) has also referred to a recent Board s Instruction No. 1080/11/DLA/CC Conference/2016 dated 08 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Act. However, I note that the lower Authorities invoked the provision of Section 73(4) to hold that such closure or proceedings is not possible in the present case. I have perused the show cause notice issued. The show cause notice stated that the appellants did not get themselves registered nor filed returns or paid service tax liability. Hence, extended period was invoked. I find no justifiable reason has been recorded in the show cause notice other than such reasons mentioned above. It would appear that the closure under Section 73(3) was not considered, only on the ground that the service tax liability paid by the appellant was for period spread over more than three years. I find that as long as full service tax liability with inte ..... X X X X Extracts X X X X X X X X Extracts X X X X
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