No penalty applicable if Service Tax was paid in cash immediately after the direction of Auditor

Last updated: 22 September 2021

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Quick Summary

In a recent ruling, the Central Excise Service Tax Appellate Tribunal (CESTAT) decided that Sud Chemie Pvt. Ltd. should not face penalties for service tax payments. The tribunal found no malicious intent, noting the company paid the tax promptly, even in cash, as soon as it was pointed out by the auditor. The ruling also addressed confusion around reverse charge mechanisms for services received from foreign entities, stating penalties were unjust for periods before specific legislation was in place.

Court :
CESTAT, Ahmedabad

Brief :
In Sud Chemie Pvt. Ltd. v. Commissioner of Central Excise, Vadodra [Service Tax Appeal No.10021 of 2019 dated September 02, 2021], Sud Chemie Pvt Ltd ("the Appellant") filed an appeal against the Order No. OIA-VAD-EXCUS-001-APP-287-2018-19 dated August 20, 2018 ("the Impugned order") which was passed by the Commissioner (Appeals) Central Excise, Customs and Service Tax, Vadodra ("the Respondent"). The Impugned order pertained to the demand of Service Tax and subsequent imposition of penalties on the Appellant by the Respondent.

Citation :
Service Tax Appeal No.10021 of 2019 dated September 02, 2021

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1 Year PLAN

1999

(Excl. of GST ₹359)

2 Years PLAN

3499

(Excl. of GST ₹629)

BEST VALUE

3 Years PLAN

4999

(Excl. of GST ₹899)

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Judgement posted by

Bimal Jain

Service

FCA, FCS LLB with21 Yrs of Experience inTaxation Indirect and Direct: Education Qualification: B.Com (Hons) Chartered Accountants Company Secretary LLB Qualified SAP FI/CO Consultants Professional Membership: Chairmanof Indirect Tax Committee of PHD Chamber of Commerce Member of Indirec ... Read more

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