2026 (6) TMI 261

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....I find that the scope of this Appeal is limited to the imposition of penalty under Section 78 alone, Appellant has chosen not to challenge the Appeal on merits. 2. Shri G. Arunmozhi, ld. Advocate appeared for the Appellant and Smt. G. Krupa, ld. Departmental Representative defended the impugned order. 3. It is the case of the Appellant that when the Show Cause Notice was issued on 27.08.2013, they had already made payments of service tax under Reverse Charge Mechanism in 2010 itself when they obtained registration. In this regard, learned Advocate seriously contended that by virtue of Explanation 2 to proviso to Section 73 (3) read with Section 80 of the Finance Act, 1994, the Original Authority should not have issued the SCN itself. ....

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....he Appellant deserves the benefit of Section 80 of the Finance Act, 1994 ?'. 6. Section 73 (3) of the Finance Act, 1994 reads as under: "SECTION 73. Recovery of service tax not levied or paid or short-levied or short-paid or erroneously refunded. - .... ... ...... (3) Where any service tax has not been levied or paid or has been short-levied or short-paid or erroneously refunded, the person chargeable with the service tax, or the person to whom such tax refund has erroneously been made, may pay the amount of such service tax, chargeable or erroneously refunded, on the basis of his own ascertainment thereof, or on the basis of tax ascertained by a Central Excise Officer before service of notice on him under sub-....

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.... Representative, I find that the Hon'ble High Court has not taken into consideration the provisions of Section 73 (3), which is also not discussed at all anywhere in the said judgement. It may be due to the fact that the aggrieved party in the said judgement did not rely on or refer to Section 73 (3). In any case, in the case on hand, the Appellant right from his Appeal before the First Appellate Authority has been contending to extend the benefit of Section 73 (3) read with Section 80, which, unfortunately has not been considered by the lower Appellate Authority. It is not the case of the Revenue that the Appellant did not pay the service tax much before the issuance of SCN as claimed and it is also not the case of the Revenue that the App....