TaxTMI 
TaxTMI 
2015 (6) TMI 783
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....n of penalty under Section 76 and the assessee s appeal is against the confirmation of part of penalty under Section 78 of the Finance Act, 1994. 2. The brief facts are that the assessee M/s Khandwala Securities Ltd. engaged in the business of providing various services like sale and purchase of share/security on which it earned brokerage and is also engaged in other activities being Corporate Advisory services and underwriting services, etc. The assessee is registered with the department since 1986 with respect to share broking services and have been paying tax regularly along with other compliances as prescribed. A show-cause notice dated 24.7.2002 was issued on the assessee stating therein that on scrutiny of profit and loss account b....
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....rvices are classifiable under Banking and Other Financial Services for which the assessee has already registered on 17.12.2002, and the assessee have discharged Service Tax liability. It is further case of the appellant that they are providing underwriter s services since 1993. They have fully discharged their Service Tax liability on the services since the introduction of the tax liability on 16.10.1998, for underwriter s services. It is further pointed out that some amount have escaped from the tax payment, resulted into short payment, but there is no contumacious conduct on the part of the assessee, as the transaction is properly recorded in the Books of Account, in the ordinary course of business. Further, the gross amount of underwriti....
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....hich is introduced w.e.f. 16.7.2001. It was further found that the correct demand under the head Underwriter s service for the financial year 1998-99 is Nil and for the year 1999-00, an amount of Rs. 6 lakhs instead of Rs. 6,90,000/- and the same has been wrongly calculated allowing the same as cum duty. It has been further held that the assessee have not charged Service Tax not collected and accordingly cum tax benefit has been allowed. It is also held that part of the service included under the Management Consultant Service is actually Portfolio Management service rendered for fulfillment of regulation of SEBI and cannot be called Management Consultant service. It was further held that there is no motive with an intent to evade tax. It wa....
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....(36) STR 456 (Tri-Mum). In all these rulings, the transactions had already been recorded in the Books of Account and no Service Tax has been collected, this Tribunal and Hon'ble High Court held that no case has been made out for imposition of penalty under Section 76 and 78. 4. The learned AR for the Revenue states that penalty under Section 76 is automatic, once there is an arrear of tax, penalty under Section 76 is attracted. He further relies on the ruling of the Hon'ble Kerala High Court in the case of Assistant Commissioner of Central Excise Vs. Krishna Poduval 2006 (1) STR 185 (Ker) wherein it has been held that Section 76 and 78 can be imposed as both of them are distinct and separate under two provisions . It was....