2017 (5) TMI 239

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....ultisystem operator services. On the basis of the intelligence that assessee did not pay correct service tax due to the Government, the Department carried out investigation against them. Upon conclusion of the investigations and issue of show-cause notice, the impugned order was passed demanding service tax amounting to Rs. 46,29,386/- along with interest. Penalties were also imposed under Section 76, 77 and 78 of the Finance Act, 1994. The adjudicating authority also appropriated the service tax already paid during investigation amounting to Rs. 40,98,487/- towards the confirmed service tax. Aggrieved by the impugned order, present appeal has been filed. 2. With the above background, we heard Shri B. V. Kumar, learned advocate for the a....

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....encing payment of such differential service tax and interest. It has been submitted that there was no mala fide intention to evade payment of service tax in the present case. This intention is evident from the fact that the appellant has not recovered the service tax from the service receivers. In spite of that, they have come forward to pay the full service tax dues along with applicable interest thereon. In this connection, we have gone through the case laws relied upon by the appellant. In the case of Fruition Informatics (P) Ltd. (supra), the Hon'ble Karnataka High Court has held as follows: "6. The material on record would clearly show that there was delay in payment of service tax and it is not disputed that the service tax a....

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....asonable cause in given case, the imposition of penalty under Sections 76, 77 and 78 is not automatic. The existence of grounds/ingredients postulated in the said provisions is a condition precedent for attracting penalty. Therefore, first, we have to find out whether in the facts of a given case whether those ingredients exist. Once it is held that those ingredients exist and the provisions are attracted, then if the language used in the said provisions do not leave any discretion in authority in the matter of imposition of penalty, penalty is to be imposed in terms of the said provision. However, if any discretion is left, then the said quasi-judicial discretion is to be exercised reasonably. Before levying penalty, the authority is requi....