TaxTMI 
TaxTMI 
Question - What are proposed amendment in Section 78 in Finance Bill 2015 ?
Amendment in Section 78
01 Mar 2015 
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Penalty rationalization under service tax: higher penalties for evasion with staged reduced penalties for voluntary payment within prescribed timeframes.
Amendment to Section 78 prescribes a penalty of 100% of the service tax amount for cases involving fraud, collusion, wilful misstatement, suppression of facts or contravention with intent to evade. It allows reduced penalties: 15% if service tax, interest and reduced penalty are paid within thirty days of service of notice; 25% if paid within thirty days of an order by the Central Excise Officer. If service tax is reduced on appeal, penalty is correspondingly modified and the 25% reduced penalty is available if paid within thirty days of the appellate order. (AI Summary)
Amendment to Section 78 prescribes a penalty of 100% of the service tax amount for cases involving fraud, collusion, wilful misstatement, suppression of facts or contravention with intent to evade. It allows reduced penalties: 15% if service tax, interest and reduced penalty are paid within thirty days of service of notice; 25% if paid within thirty days of an order by the Central Excise Officer. If service tax is reduced on appeal, penalty is correspondingly modified and the 25% reduced penalty is available if paid within thirty days of the appellate order. (AI Summary)