TMI Blog2006 (7) TMI 714X X X X Extracts X X X X X X X X Extracts X X X X ..... 4-11-2005 which confirmed the demand of the duty and imposition of the penalty on the appellant. 2. None appeared for the appellant. The appellants have filed written submissions. In the written submissions appellants have clearly indicated they have not challenging the service tax liability and interest thereof but their appeal is limited only to the penalty. The specific averment is at paragr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... It is his submission that there was specific instruction to pay the service tax liability, despite the clarification sought by them, still the appellant chose not to pay service tax and hence penalty imposed is correct that no leniency be shown. 4. Considered the submissions made by learned DR and perused the case records. I find that the problem in this case is regarding the eligibility to ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed to refer to your representation forwarded to Finance Minister vide letter dated 11th March 2003 and state that in terms of the notification 12/2003-ST dated 20th June 2003, the exemption in respect of input material consumed/sold by the service provider to the service recipient while providing the taxable service is available. However the exemption is available only if the service provider main ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Commissioner (Appeals) dismissed the appeal of the appellants as regards reduction of the cost of material from the service tax liability and the appellants have admitted that and deposited the amount of service tax and interest on 19-12-2005. 6. Since there was the confusion in respect of the eligibility to the benefit of Notification No. 12/2003, to my mind, the imposition of penalty is unwa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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