Timely service tax payment on GTO services barred penalty and interest where statutory compliance requirements were met.

Service tax paid on GTO services within the permissible time limit under the Finance Act, 2003 and the period applied by the Supreme Court for similar assessees did not attract penalty under Section 76 or interest under Section 75. The same Bench had earlier held that timely payment and compliance with the statutory requirements barred such liability, and the revisional authority erred in proceeding on an incorrect view of the law by imposing penalty and directing interest.

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Issues: Whether the appellant was liable to penalty under Section 76 of the Finance Act, 1994 and interest under Section 75 of the Finance Act, 1994 for service tax paid on GTO services, and whether the revisional order imposing such liability was sustainable.

Analysis: The appellant had paid the service tax and related interest within the time limit recognised by the Finance Act, 2003 and within the period applied by the Supreme Court for similar assessees. The earlier decision of the same Bench in an identical matter had held that, where the tax was paid within the permissible period and the statutory compliance requirements were met, no penalty could be sustained. On that reasoning, the revisional authority had proceeded on an incorrect understanding of the law in imposing penalty and directing payment of interest.

Conclusion: The appellant was not liable to penalty or interest as imposed in the revisional order.

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