If there was no malafide for the purpose of penalty, there cannot be any malafide for the purpose of limitation also
PrintListen to this Article
If there was no malafide for the purpose of penalty, there cannot be any malafide for the purpose of limitation also
We are sharing with you an important judgment of the Hon’ble CESTAT, New Delhi, in the case of Internet Computer Centre Vs. CCE, Lucknow [2014 (12) TMI 663 - CESTAT NEW DELHI] on following issue:
Issue:
Whether malafide for the purpose of limitation is possible, when there is no malafide for the purpose of penalty?
Facts & background:
In the instant case, Internet Computer Centre (“the Appellant”) availed the benefit of Small Scale Exemption under erstwhile Notification No. 6/2005-ST dated March 1, 2005 (“SSI Notification”) which was denied by the Lower Authorities on the ground that the services rendered by the Appellant are branded services and the same is excluded from the applicability of the SSI Notification. Therefore, the Lower Authorities confirmed the demand of Service tax of Rs. 98,064/- and imposed penalty of Rs. 50,000/- under Section 76 of the Finance Act, 1994 (“the Finance Act”) on the Appellant by invoking extended period of limitation.
On appeal being filed to the Commissioner (Appeals), the Commissioner (Appeals) set aside the penalty imposed upon the Appellant on the ground that the Appellant was under the bonafide belief that they are entitled to the benefit of the SSI Notification hublot replica and that on being pointed out by the Department, the Appellant paid the due tax and interest before issuance of Show Cause Notice. Thus, there was no malafide intent on the part of the Appellant and penal action is not justifiable. However, the demand of Service tax was confirmed against the Appellant.
Being aggrieved, the Appellant filed an appeal before the Hon’ble CESTAT, Delhi on the ground of limitation.
Held:
The Hon’ble CESTAT, Delhi held that if there was no malafide for the purpose of penalty, there cannot be any malafide for the purpose of limitation also. Accordingly, the matter was decided in favour of the Appellant and the demand being barred by limitation was set aside.
Hope the information will assist you in your Professional endeavors. In case of any query/ information, please do not hesitate to write back to us.
Thanks & Best Regards,
Bimal Jain
FCA, FCS, LLB, B.Com (Hons)
Delhi:
Flat No.34B, Ground Floor, Pocket - 1,
Mayur Vihar, Phase–I,
Delhi – 110091
Desktel:+91-11-22757595/ 42427056
Email: bimaljain@hotmail.com
Category : Service Tax | Comments : 0 | Hits : 215
CENVAT CREDIT ON SET TOP BOX INTRODUCTION Service providers have at least a Telephone in their office. They are paying service tax on the telephone charges. The service tax on telephone charges becomes a part of the cost for the service provider. When he collects service tax from the customer it becomes tax on tax which increases the actual rate of tax payment. This phenomenon of tax on tax is called the cascading effect. The government does not want this to happen. The...
NO KRISHI KALYAN CESS ON DEBTORS AS ON 13th MAY’ 2016 (PART -2) Read more at: http://www.casansaar.com/article-submit.htmlThe enabling provisions for KRISHI KALYAN CESS (KKC) are contained in Chapter – VI of Finance Act’ 2016. As per the provisions, KKC shall be applicable at 0.5% on all taxable services and the proceeds of KKC would be exclusively used for financing initiatives relating to improvement of agriculture and welfare of farmers. The Cess will come into force with ...
As you are aware that the Finance Act, 2016 has increased the service tax rate to include a new cess, namely Krishi Kalyan Cess, which is applicable w.e.f. 01/06/2016. The effective rate of service tax for all new services provided after 01/06/2016 shall be as below: Service Tax ...
CENVAT CREDIT AVAILABLE VS CENVAT CREDIT TAKEN ALARMING AMENDMENT IN RULE 6(3) OF CENVAT CREDIT RULES (a) A manufacturer who manufactures two classes of goods namely:- Non exempted goods removed Exempted goods removed Or (b) a provider of output service who provides two classes of services, namely:- Non Exempted Services Exempted Services Shall follow any one of the following options applicable to him namely:- (i) pay an amount equal to 6% ...
Date : 19.03.2016 M/s. ABC LLP ( Service Provider ) M/s. XYZ Limited ( Service Recipient ) Ref: Service Tax on Works Contract and RCM Opinion Before giving opinion on the issues it will be useful to refer the questions related with this transaction. Assume ABC is LLP and XYZ Ltd is Body Corporate. ABC LLP is a sub contractor of XYZ Limited. XYZ Ltd sub contracted Works Contract work as well as Labor work also some time. Both partie...
Comments