2026-VIL-1318-CESTAT-ALH-CE
  1. Home
  2. 2026-VIL-1318-CESTAT-ALH-CE

CENTRAL EXCISE CESTAT Cases

Central Excise – Validity of imposition of penalty under Section 11AC of Central Excise Act and Section 78 of Finance Act when duty and service tax have been deposited with interest before issuance of show cause notice - Whether penalties under Section 11AC of Central Excise Act and Section 78 of Finance Act are imposable when the assessee has deposited duty and service tax along with due interest before issuance of show cause notice - HELD – The plain reading of Section 11AC and proviso to Section 11AC of Central Excise Act clearly provides that where duty and interest payable under Section 11AA is paid either before issue of show cause notice or within thirty days of issue thereof, no penalty shall be payable by person liable to pay duty and all proceedings shall be deemed concluded. Imposition of penalties by lower authorities went contrary to provisions of Act and showed total failure to read statutory provisions - Similarly penalties under Section 78 of Finance Act on service tax short paid on reverse charge basis for Legal Services cannot be imposed as appellant had deposited entire service tax liability along with interest before issuance of show cause notice - Regarding service tax demand on reverse charge basis on transportation services claimed to be revenue neutral. Even if situation were revenue neutral, it does not wipe off tax liability, it imposes restriction on invocation of extended period of limitation. When the issue made is revenue neutral then there cannot be any reason for holding that the appellant could be held guilty for having intention to evade payment of service tax - Penalties under Section 78 imposed on revenue neutral transactions cannot be sustained. Penalties under Section 70 for late filing of returns are of civil nature and remedial and do not require mens rea. Appellant's appeal is partially allowed and penalties under Section 11AC aggregating to one amount and penalties under Section 78 aggregating to another amount are set aside while penalties for late filing of returns are upheld – The appeal is partly allowed
Download File

Quick Search

/

Advance Search

GST Resources

/

Gst Rate Finder

Tax Vista

Your Weekly Tax Recap

By Kasi Viswanathan V

Weekly Summary

VIL Video

GSTAT Filing Near: Closing Resolutions...
By CA Vivek Jalan

Create Account

Security-Code
New Code?

Log In

New User ? Forgot Password ?

Forgot Password

Security-Code
New Code?
Please Note: This facility is only for Subscribing Members.

Email this page

Security-Code
New Code?

Feedback this page

Schedule a Demo

Schedule a demo to know the features and advantages of VILGST portal. Get to know the tips to find the desired results in faster way.

Security-Code
New Code?

Caselaw Request Form (CRF)

Didn’t find what you are searching for? No worries, please give us the following details and VIL will email you the desired Caselaws at the earliest:

Security-Code
New Code?