Order Date – 07 February 2023

Parties: Gujarat Alkalies And Chemicals Ltd Vs C.C.E. & S.T.-Vadodara-i

Facts –

• The Appellant, Gujarat Alkalies And Chemicals Ltd, is a government company and they have not paid Service tax on the services related to external commercial borrowing from the ICICI Bank- Hong Kong.
• Department imposed penalty under Section 76,77, &78

Issue – 

• Whether penalty imposed under Section 76,77, &78 can be set aside invoking Section 80?

Order – 

• The Tribunal observed that being a government company admittedly the appellant have recorded all the transaction in their books of account and as and when the short payment of Service tax was pointed out by the department, the appellant have deposited the Service tax along with interest thereon without raising any objection.
• It was held that suppression, mis-declaration, etc. cannot be attributed to the appellant. The appellant has also intimated the department about the payment of entire service tax and interest thereon.
• The case is squarely covered by Section 73(3) of the Finance Act, 1994 according to which on payment of service tax and interest, no show cause notice should have been issued and the case stand closed on such payment. 
• Accordingly, no penalty either can be proposed or can be imposed.
  
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