9911796707
TMI Blog2023 (8) TMI 1235X X X X Extracts X X X X X X X X Extracts X X X X ..... is of third party information, investigation was conducted against the Appellant for the period from 2011-12 to 2014-15. On the basis of scrutiny of the documents submitted by the Appellant, a show cause notice was issued demanding service tax amounting to Rs.4,06,44,637/- alongwith interest and for imposition of penalty under section 78 of the Finance Act, 1994. In the show cause notice, service tax amounting to Rs.270,79,523/- was demanded on the value of material/spare parts sold by the Appellant during servicing of motor vehicles. Written reply to the show cause notice was submitted wherein Appellant inter-alia contested the demand of service tax on sale material/spare parts. The demand as proposed in the show cause notice was confirmed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tands settled by the order of another Division Bench of this in the case of Samtech Industries v. Commissioner of Central Excise - 2015 (38) S.T.R. 240 (Tri.-Del.), wherein the assessee was providing the service of repairing transformer and was using consumables like transformer oil and also component parts being coil etc., the Tribunal held, in view of the fact that it is not disputed that in respect of the supply of goods, used for providing of service of repair, Sales Tax/VAT is paid, which fact is evident from the invoice on record. It was also observed that when the value of goods used is shown separately in the invoice and on the same Sales Tax/VAT has been paid, the supply of the goods would have to be treated as sale and the transac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... both directors of the Appellant company is concerned, we find that penalty of Rs.1,00,000/-(One lakhs) each was imposed by the Adjudicating Authority by merely observing that these two Appellants aided and abated Appellant company to suppress and evade payment of service tax. In this regard, it is observed that since the major demand against the Appellant company has already been found unsustainable and said penalty can only be imposed when company is found to be engaged in evasion of service tax and the person in question were knowingly concerned with such contravention. On facts and under the circumstances of the case, ingredients to impose penalty under section 78 A of the Act does not exist. We therefore, propose to drop the penalty imp ..... X X X X Extracts X X X X X X X X Extracts X X X X
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