2014 (12) TMI 328

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.... and thereby a short payment of service tax amounting to Rs. 86,440/- during the year 2004-05, 2006-07 and 2007-08. Further, on verification of Profit & Loss A/c for the year 2007-08, it was found that the appellants had received income of Rs. 2,29,750/- under the head 'Catering Income' but failed to apply for addition of the said category in their existing service tax registration as well as failed to pay service tax on the said amount. The said income was taxable under the category of 'Outdoor Caterer' service. Thus there was a short payment of service tax of Rs. 28,397/- on the income of Rs. 2,29,750/- under the said category. It also appeared that the abatement granted under Notification No. 1/2006-S.T., dated 1-3-2006 is conditional an....

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.... sides. 4. The ld. CA on behalf of the appellant claimed that as soon as it was pointed out to the appellants that they were required to pay service tax on the amount received from catering income and for the shortfall under the head "business auxiliary service", even before the issue of show cause notice, the appellants calculated the liability of service tax and paid the same with interest. The service tax amount of Rs. 49,110/- and interest of Rs. 21,994/- was paid on 2-8-2008 and 17-2-2009, whereas show cause notice was issued on 20-4-2009. Therefore, he submits that in this case penalties under Sections 76 and 78 were not imposable since the appellants had paid the entire amount of service tax with interest. He relied upon the ....

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....service tax as has been demanded. On the 'Outdoor Caterer' service, the appellant has not paid service tax at all and the appellant had also not paid the correct amount of service tax on the consideration received for the services rendered by them over a few years. In such a situation, penalty u/s. 78 is imposable and has been correctly imposed. 8. Coming to penalty u/s. 76 of the Finance Act, 1994, there are decisions taking a view that penalties are imposable u/s. 76 & 78 of the Finance Act, 1994 prior to April, 2008 when Section 78 was amended to provide for no penalty u/s. 76 when penalty has been imposed u/s. 78. However, in this case, taking note of the fact that total amount short-paid is less than Rs. 50,000/- and it has occ....