2019 (6) TMI 1023

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....nufacturing and clearance of Sugar, Molasses, Electricity Special Denatured Spirit and denatured extra Natural Alcohols. They have also registered for payments of service tax under category of GST, Security/Detective Agency and Manpower Recruitment/Supply Agency. They are availing Cenvat credit of duty paid on inputs/capital goods and input services under provisions of Cenvat Credit Rules, 2004. During Audit, it has been found that from July, 2012 to October, 2013 the Appellant had paid an amount of Rs. 45,40,089/- towards the payment made in respect of supply of Manpower but they did not pay the service tax amounting to Rs. 4,20,869/- in terms of provisions of Section 68(2) of the Finance Act, 1994 read with Notification No. 30/2012-ST dat....

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....vat credit. He further submitted that as per settled law when transaction is revenue neutral allegation of suppression fails and therefore, penalties are not sustainable. In support of his submission, the learned Counsel relied upon the decision of this Tribunal in the matter of Jain Irrigation Systems Ltd. vs. CCE, Nashik; 2015(40) STR 752(Tri-Mumbai). As an alternative submission, he submitted that as per Section 78 ibid it is mandatory to give option to pay service tax, interest and 25% service tax towards penalty under Section 78 within 30 days of the receipt of adjudication order but such option was not given to the Appellant by any of the Lower Authorities despite the fact that the Appellants have deposited the duty with interest much....

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....rding the facts that the service tax was paid by the assessee therein after the issuance of SCN but before the passing of the Adjudication order, set aside the recovery of penalty in view of revenue neutrality. The relevant extract of the aforesaid decision is as under:- "xxxx         xxxx            xxxx           xxxx 6. .........................The revenue neutral situation comes about in relation to the credit available to the appellant himself and not by way of availability of credit to anyone else. Therefore the case of Jay Yushin Ltd. applies in the present situation after considerin....