Order date – 23 March 2023

Parties – M/s Kanoi Textile Agency Vs Commissioner of CGST & Excise, Ranchi

Facts – 

• The Appellate, M/s Kanoi Textile Agency, made the delay in payment of service tax on TDS.
• A show cause notice was issued to the Appellate.
• Before issuance of the show cause notice the Appellate paid the service tax on TDS.
• The impugned order in original dropped the reimbursement expenses but while adjudicating the case, the ld. Commissioner imposed penalty on the appellant under Section 78 of the Finance Act, 1994.

Issue –

• Whether the penalty imposed against the Appellate under section 78 of the Finance Act, 1944 justified?

Order –

• The Tribunal considered the view that it is on record that the appellant has paid the service tax before issuance of show-cause notice.
• With respect to this the Tribunal held that penalty under Section 78 of the Finance Act, 1994, was not required to be imposed on the appellant.
• The Appeal is allowed with consequential relief, if any, and the penalty is dropped against the appellate.