Liability of service tax and interest

[Guest]

My client is contactor he worked for housing board society for construction of their housing projects (LIG, MIG houses).He registered him self under construction service since 2004. but does not take registration under Construction of Residential complex Service, therefore he does not pay Tax on time and also fail to submit returns in time. In year 2007 he take registration under CCS (i.e. After two years from 16-06-2005 applicable of CCS, in 2007) and he has paid full amount of ST with interest thereon and filed all such returns up to date. Now he received show cause notice cum demand notice on 13-06-2008 in notice the department has asked to him to pay full amount of ST+Interest, penalties u/s 76,77 &78. As we had paid full tax + interest before issuance of show cause notice. In my view my client is not liable for payment of ST+interest, I want your views and some case laws for preparation of reply to departments show cause notice.

AI Summary

Contractor Faces Penalties for Late Registration and Tax Payment; Sections 76, 77, and 78 Discussed for Penalty Applicability A contractor working for a housing board society registered under construction services in 2004 but failed to register for Construction of Residential Complex Service (CCS) until 2007, resulting in delayed tax payments and returns. Despite paying the full service tax and interest before receiving a show cause notice in 2008, the contractor faces demands for additional penalties under sections 76, 77, and 78. The response suggests that penalties under Section 78 can apply even if taxes were paid before the notice, depending on intent. It also notes that penalties under Sections 76 and 78 are mutually exclusive, and waivers may be possible under Section 80.