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June 2014

2014 (34) STR 235 (Tri.-Bang.) Esskay Shipping (P) Ltd. vs. CCE, Visakhapatnam

By Puloma Dalal, Jayesh Gogri, Mandar Telang Chartered Accountants
Reading Time 1 mins
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Whether penalty is leviable u/s. 76 of the Finance Act, 1994 when service tax with interest is paid before issuance of SCN and the same is intimated to Central Excise officer? Held no.

Facts:
The Appellants paid service tax with interest for the period from October, 2010 to March, 2011 before issuance of SCN. Penalty u/s. 76 of the Finance Act, 1994 was imposed under SCN.

Held:
As per section 73(3) of the Finance Act, 1994, if the assessee has paid service tax and intimated to the Central Excise officer, Central Excise officer cannot issue SCN u/s. 73 (1) of the Act. Further, Explanation 2 to the said section provides that in a case of payment of service tax and intimation to Central Excise officer, no penalty is imposable. Therefore, the order was set aside.

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