The Assistant Commissioner on finding that certain factors had created a confusion in the minds of the assessee which was reasonable cause on the part of the assessee in his failure to pay the service tax on time and since assessee had paid the service tax with interest much prior to the issue of the show cause notice, set aside penalty. However, the revisional authority revised said order and imposed penalties on the assessee.
On appeal :
The original authority had examined the issue with regard to non-imposition of penalty. The assessee had deposited the service tax along with interest before the issue of show cause notice. It did not have any intention to evade duty, as it had bonafide belief and there were factors which had created confusion in the minds of the assessee with regard to the service tax to be paid. That very reason was examined by instant Tribunal in the case of Majestic Mobikes (P.) Ltd v. CST 16 STT 296(Bang. - CESTAT) and similar orders passed by the revisionary authority had been set aside. Therefore, following the above judgment rendered in Majestic Mobikes (P.) Ltd. case (supra), the impugned order was to be set aside. [Para 5]