No penalty if service tax been paid immediately after pointing by Auditor

Sud Chemie Pvt Ltd. Vs C.C.E. & S.T. (CESTAT Ahmedabad)

Sud Chemie Pvt Ltd (Appellant) filed an appeal against the Order No. OIA-VAD-EXCUS-001-APP-287-2018-19 dated August 20, 2018 (Impugned order) which was passed by the Commissioner (Appeals) Central Excise, Customs and Service Tax, Vadodra (Respondent). The Impugned order pertained to the demand of Service Tax and a subsequent imposition of penalties on the Appellant by the Respondent.

The Appellant, raised two issues before the Tribunal:

1. The first issue related to the payment of service on the reverse charge basis (“RCM”) on Goods Transport Agency (“GTA”) services received by the Appellant– when the Respondent pointed out that this amount should be paid in cash, the Appellant discharged the duty in cash on December 27, 2006 and therefore, were entitled to the benefit under Section 73(3) of the Finance Act, 1994.

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