2018 (12) TMI 949 – CESTAT CHENNAI – TMI – Demand of interest and penalties – non-payment of service tax – rent received – Held that:- There was delay in dispatch of the Order-in-Original and therefore the demand of interest cannot sustain. This argument is neither tenable nor acceptable. The demand of interest 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 service tax and were not collecting the service tax from the tenants. Further, there is no evidence to establish that they had suppressed facts with intention to evade payment of service tax – the penalty imposed under section 78 cannot sustain.
–
Penalty u/s 77(2) of FA – non-filing of
= = = = = = = =
Plain text (Extract) only
For full text:-Visit the Source
= = = = = = = =
onfirmed the demand along with interest and imposed penalties under section 78 as well as under section 77(2) of the Finance Act, 1994. In appeal, Commissioner (Appeals) upheld the demand of interest and penalties. Hence this appeal. 3. On behalf of the appellant, ld. counsel Shri K. Sankara Narayanan appeared and argued the matter. He submitted that the appellant is a Hindu Religious Endowment Trust and was outside the purview of service tax prior to 2012. They did not know after the amendment of Finance Act, 1994 they had to discharge service tax as the said services did not fall within the negative list. The appellant contested the matter on the belief that they have a good 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 rel
= = = = = = = =
Plain text (Extract) only
For full text:-Visit the Source
= = = = = = = =
t 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 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 service tax and were not collecting the service tax from the tenants. Further, there is no evidence to establish that they had suppressed facts with intention to evade payment of service tax. Taking these facts into consideration, I am of the view that the penalty imposed under section 78 cannot sustain and requires to be set aside. The original authority has imposed penalty of ₹ 10,000/- under section 77(2) for non-filing of returns within the stipulated period. Since the appellant has later filed th
= = = = = = = =
Plain text (Extract) only
For full text:-Visit the Source
= = = = = = = =