2018 (5) TMI 672

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....nt hosting network services from a company, Sunguard Availability Services LP, located outside India and made payment to them in foreign currency i.e. in US Dollar, but the appellant has not discharged the service tax on reverse charge mechanism on such payments in contravention of Section 66A of the Finance Act, 1994. The adjudicating authority has confirmed the demand along with interest and imposed penalty of equal amount under Section 76 and 78 of the Finance Act, 1994. Being aggrieved by the order-inoriginal, the appellant filed appeal before the Commissioner (Appeals) which was disallowed by upholding the order-in-original passed by the adjudicating authority except the demand pertaining to the period April 2007 to September 2007 whic....

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....h M. Kotian - 2016 (42) STR 772 (Tri.- Mumbai); (iv) Gujarat Borosil Ltd. - 2014 (36) STR 808 (Tri.- Ahmd.). He prays for waiver of penalties imposed under Section 76 and 78 by invoking Section 80 of the Finance Act. 3. On the other hand, Shri M.P. Damle, learned Assistant Commissioner (AR) appearing on behalf of the Revenue, reiterates the finding of the impugned order. He submits that there was no doubt that the receipt of services from abroad was liable for service tax under the reverse charge mechanism. The appellant also not declared the value of such taxable service in their ST-3 return. Therefore, there is a clear intention to evade payment of service tax. Therefore, the penalty imposed under Section 76 and 78 is corre....

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....t of the definition. That being the case, the appellants were eligible to take credit of the Service Tax so payable if the appellants were to pay excise duty on any of the export goods. Though there were conflicting decisions in this issue by the Hon'ble Gujarat High Court in the case of CCE v. Cadilla Health Care - 2013 (30) S.T.R. 3 (Guj.) and by Hon'ble Punjab and Haryana High Court in CCE v. Ambika Overseas - 2012 (25) S.T.R. 348 (P & H), now it stands accepted by C.B.E. & C. in their circular 943/4/2011-CX dated 29-4-2011 at item 5 that Cenvat credit can be taken on such services. On textile products a voluntary scheme for payment of excise duty was in force. So the appellants could pay duty, take credit and utilize it either for local....

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....rvice tax with an intent to evade payment of Service Tax. In a similar case of ECB - Enercon (India) Ltd. v. Commissioner of Central Excise & Customs, Daman (supra), this Tribunal has held as under : "5. In this case, since whatever amount was due as Service Tax, was available as credit to the appellant, penalty under Section 78 of the Finance Act, 1994 cannot be sustained since there is no need for suppressing fact, resorting to mis-declaration or undertake fraudulent act with intention to evade duty since the Cenvat credit would be available, the moment the payment is made to the Government. This view was upheld by the Hon'ble High Court of Karnataka in the case of C. Ahead Info Technologies India P. Ltd. In that case, the Revenu....