2016 (8) TMI 848

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....tice proposing to recover service tax of Rs. 6,84,167/- under the categories renting of immovable property and sale of space for advertisement for the period 2006-07 to 2009-10. The original authority after allowing SSI exemption, confirmed the demand of Rs. 5,85,287/- along with interest and imposed penalty under Section 77 and equal amount of penalty under Section 78 of the Finance Act, 1994. The appellants carried the issue in appeal before the Commissioner(Appeals) who vide the order impugned herein upheld the demand, interest and penalty. Hence the present appeal. 3. On behalf of the appellants, the learned counsel Ms. A.S.K. Shwetha submitted that the challenge is confined to the penalty imposed. That the issue of demand of servi....

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....ample time for the defaulters to clear the service tax liability. The appellants failed to pay the interest within this period. Therefore appellant is liable to pay the penalty which has been correctly imposed by the authorities below. 5. I have heard the rival submissions. Undeniably the issue whether activity of renting of immovable property is subject to levy of service tax was a contentious one. In the present case, the value of taxable service of sale of space or time for advertisement for the respective period is less than the threshold of exemption. The contention of the appellant that they bonafidely believed that their services would not be taxable as renting of immovable property services was subject matter of litigation pendi....

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....-section (2) of Section 80, then the assessee has to be treated as though sub-section (2) of Section 80 did not exist. It nowhere says that in case of failure to avail benefit under sub-section (2) of Section 80, the benefit under sub-section (1) of Section 80 will be taken away. As per sub-section (1) of Section 80 if the assessee proves reasonable cause for failure, then no penalty shall be imposible. The appellant has established that the failure was caused because they were a small scale service provider with regard to the service of sale of space advertisement. They bonafidely believed that no tax was payable on the services of renting of immovable property during the relevant period. In the case of Mahesh Vakatawarmal Rathod (supra),....