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TMI Blog2018 (5) TMI 1466X X X X Extracts X X X X X X X X Extracts X X X X ..... payment of service tax in respect of 4 invoices and service tax was paid on these invoices by the appellants on their own ascertainment with a delay of 6 months to 3 years. When the department when conducted an audit on 4.01.2016 to 12.01.2016 it found that the appellant had delayed the payment of service tax under reverse charge mechanism but the interest amounting to Rs. 24,87,141/- due thereon had not been discharged by the assesse, at the behest of the department, the appellant later on paid full interest liability on 18.06.2016. A show cause notice was issued to the appellant on 02.01.2017 demanding Service tax of Rs. 8,81,082/- and interest of Rs. 24,87,141/- already paid by assesse and proposing penalty on the appellant under Sectio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e-I 2016 (45) STR 338 (Tri. Mum) * Modern Woolens vs CCE, Jaipur-II 2017 (52) STR 288 (Tri. Del). Ld. Advocate also relies on the order of the Hon'ble Supreme Court upholding the order of the Tribunal in the case of Jet Airways (India) Ltd. 2017 (7) GSTL J35(SC). 3. Ld. AR for the Revenue submits that there was long gap in payment of duty and the delayed payment was made repeatedly. She also pleads that the Ld. Adjudicating authority has given sufficient relief in penalty as per law under Section 78. She also pleaded that the interest was paid at the behest of the department. Ld. AR relied on the judgment of Hon'ble Supreme Court in UOI vs Rajashtan Spinning & Weaving Mills 2009 (238) ELT 3 (SC). 5. Heard both the sides and perused the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e notice. The ingredients of Section 78 like suppression or malafide intent to evade duty do not emerge from the facts of the case. 8. I find that in a similar scenario where the service tax as well as interest had been paid before the issuance of show cause notice, this Tribunal in the case of Arcgate vs CCE Jaipur-II (supra) had held that penalty was not justified and set is aside. Relevant findings of the Tribunal decision are extracted below: "4. I have heard both the sides and perused the appeal records. The service tax liability is not disputed in the present case. The same has been discharged with applicable interest, for delayed payment, more than 4 months before the issue of notice. In the normal course the case gets closed witho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the penalty imposed based on the proceedings initiated is not justifiable. Accordingly, the same is set aside. The appeal is allowed to that extent only." The same view has been taken by the Tribunal in the case of Kalbhor Construction Co. (supra) and Gujrat Borosil (supra). 9. I also find that 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. In such a situation, the Tribunal has held in the case of Modern Woolens (supra) that penalty was not justified. 10. By following the above judgments of this Tribunal, I am of the view that the imposition of penalty under Section 78 is not justified in the facts and circumst ..... X X X X Extracts X X X X X X X X Extracts X X X X
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