AI Drafter 
TaxTMI 
TaxTMI 
2016 (5) TMI 230
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....ondent") was subject to audit by the Service Tax authorities. During the course of audit, it was noticed by the Revenue that excess CENVAT Credit was availed by the Respondent to the tune of Rs. 13,69,210/-. The Respondent had agreed to the aforesaid observation of the audit department and has reversed the CENVAT Credit availed along with interest under protest before issuance of Show cause notice. A show cause notice no. LTUC/147/2011- (ADC) dated 21.04.2011 was issued stating that there was willful suppression on the part of the respondent in availing the CENVAT credit twice and proposed to levy penalty equal to the tax amount due. The Respondent had replied to the notice on 01.07.2011 stating, that interest is not applicable when the CEN....
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....ue has preferred this appeal before Tribunal. 4. In the grounds of appeal, the Revenue has contended that the respondent-assessee had availed wrong CENVAT Credit on many occasions and that was not disclosed to the department either in their ST-3 returns or in any other form and hence suppression has been clearly established; that accordingly, extended period of limitation was invoked under proviso to Section 73(1) of the Finance Act, 1994 and consequently no waiver of penalty is possible under Section 80 of the Finance Act, 1994; that the case law relied by the Commissioner (Appeals) in the case of Atwood Oceanics (supra) has not been accepted by the Department and that an appeal has been preferred before the Supreme Court; that in the case....
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....casions out of 9400 entries (approx.). He also placed reliance on the ruling of Canara Bank Vs Commissioner of Service Tax Bangalore 2016 (3) TMI 712 - CESTAT BANGALORE, wherein it was held that no penalty is to be levied for unintentional mis-happenings/mistakes that take place at the time of availment of CENVAT Credit. 6.1 As regards the applicability of the ruling of the Madras High Court, he submits that there was no wilful suppression in their case and accordingly the case law relied by the Appellant is squarely distinguishable. He also submitted that several audits were conducted by the Appellant before and during the period of dispute and they were completely aware of all facts for the said period. He further submitted that it is ....
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....the month of November 2009; the said lapse has been explained by the appellant saying that the said services were received from abroad in their Mumbai office and statements using such services come to their centralized office in Bangalore. Sometimes such unintentional mis-happenings/mistakes do take place for which the appellant is not to be punished by imposing the penalties. The appellant has also cited in defense the Honble Supreme Courts decision in the case of Hindustan Steel Ltd. Vs. State of Orissa [1978 (2) E.L.T. (J159) (SC)] saying that in case of unintentional lapse imposition of penalty is not justified. 7. Considering the facts on record and the decision of the Honble Supreme Court in the case of Hindustan Steel Ltd.....
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....from a bona fide belief that the offender is not liable to act in the manner prescribed by the statute. Those in charge of the affairs of the Company in failing to register the Company as a dealer acted in the honest and genuine belief that the Company was not a dealer. Granting that they erred, no case for imposing penalty was made out." The Revenue has alleged that there was wilful suppression in the present case as they had detected that wrong availment of credit only during the course of audit conducted by them. In this regard, I find that the ruling of the Tribunal in the case of Atwood Oceanics Pacific Ltd. Vs, CST Ahemdabad (supra) is squarely applicable to the facts of the present case. The relevant extract of the ruling is....
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....t case, as contended by the Appellant, as the Respondent has paid the service tax and interest by showing their Bonafides. The Appellant has relied on the ruling of the Madras High Court in the case of Dhandayuthapani Canteen (supra) wherein it was held that penalty is payable even though service tax and interest has been paid prior to the issuance of show cause notice. However, I find that in the case relied on by the Appellant, willful suppression was established and not litigated by the Appellant. However, in the present case, as seen above since there is no wilful suppression on the part of the Respondent, I am of the view that the case law relied on by the Appellant is not applicable to the facts of the present case. Further, I also fi....