2024 (7) TMI 759

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....e case of the Respondent? ii) Whether the Respondent being a Public Sector Undertaking and yet not paying the Service Tax due in this case ought to be considered to be "reasonable cause"? iii) Whether the ratio in the case of HUDCO [2012 (26) STR 531 (T-Ahd)] were correctly understood and applied in this case by the Hon'ble CESTAT, Mumbai? iv) Whether the Hon'ble CESTAT, Mumbai was correct in holding that various penalties ought not to have been imposed under Sections 76, 77 and 78 of the Finance Act? v) Whether after holding that the various penalties under Sections 76, 77 and 78 were imposable, they ought to have been waived? vi) Whether the Hon'ble CESTAT, Mumbai was correct in holding that ta....

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....ax amount of Rs. 18,11,23,250/- under Section 78, was also imposed. A penalty of Rs. 10,000/- for failure to take registration within specified timeline and for not having properly self assessed their service tax liabilities was also imposed. 4. Respondent filed an appeal before the Customs, Excise and Service Tax Appellate Tribunal (CESTAT). The appeal came to be disposed by the CESTAT vide an order dated 8th June 2020 partly holding in favour of appellant. The CESTAT upheld the demand of tax and interest but as regards the penalty that was imposed on respondent, set aside the order passed by the Commissioner. Ms. Menon stated that to the extent the CESTAT held against respondent, respondent has preferred an appeal before the Hon'ble Ap....

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....e for the said failure." We consider that the appellant being a wholly owned government company and the fact that they did not pay Service Tax only on prepayment charges and reset charges and also in view of the fact that accounting treatment given to these items as additional interest has been accepted by the Income Tax department, in our opinion, would be sufficient for invoking provisions of Section 80 of Finance Act, 1994. Accordingly, while upholding the demand of Service Tax and interest, penalties imposed under various Sections of Finance Act, 1994 are set aside." Thus taking note of the fact that Appellants are a public sector undertaking, amounts demanded as service tax will be admissible to the Appellants will be admissible to ....