TMI Blog2018 (12) TMI 949X X X X Extracts X X X X X X X X Extracts X X X X ..... erest is correct and proper and therefore is upheld. Penalty u/s 78 - Held that:- The appellant had not collected service tax from the tenants and that the matter was remanded by Commissioner (Appeals) to requantify the service tax liability giving cum-tax benefit. Taking note of this fact, it is established that the appellants were under the bonafide belief that they are not liable to pay ser ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... kumar, AC (AR) for the Respondent ORDER The appellant is aggrieved by the interest and penalties which is upheld in the impugned order. 2. Brief facts are that the appellant, which is a religious trust, had leased out their property for rent. Department was of the view that they are liable to pay service tax on the rent received and show cause notice was issued proposing to demand th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case on merits. After receiving the Order-in-Original, they have discharged the entire service tax and he pleaded that the penalties may be set aside. It is argued by the ld. Counsel that the delay in paying the service tax was only due to the bonafide belief that being an entity of the Government and being a religious trust, they are exempted from paying service tax. It is also submitted by him t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... interest cannot sustain. This argument is neither tenable nor acceptable. The demand of interest, in my view, is correct and proper and therefore is upheld. However, with regard to the penalty imposed under section 78, it is seen from the impugned order passed by the Commissioner (Appeals) that the appellant had not collected service tax from the tenants and that the matter was remanded by Commiss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pellant is a Government wing, I am of the view that the penalty imposed under section 77(2) cannot sustain and requires to be set aside. The impugned order is modified to the extent of setting aside the penalties imposed under sections 78 and 77(2) without disturbing the remaining portion of the order. The appeal is partly allowed in the above terms with consequential relief, if any. (Dictated ..... X X X X Extracts X X X X X X X X Extracts X X X X
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