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Works Contract - Non Payment of Service Tax
Service Tax – work contract – non-payment of service tax due to the bonafide belief – appellant providing service of works contract with material and discharging VAT as per the VAT provisions – discharge of the service tax along with interest before issuance of show cause notice – appeal for waiver of penalty under Section 76
HELD – The appellant submitted that they were under bonafide belief that since works contract provided by them with material therefore the same is not liable for service tax.
The Department retrieved the data from the books of accounts of the appellant, therefore this fact shows that there is force in the arguments of the appellant as regard entertaining bonafide belief for non-payment of service tax - appellant has shown reasonable cause for non-payment of service tax and considering facts that the appellant has discharged service tax, before issuance of show cause notice, they are entitle for the waiver of penalty imposed under Section 76 invoking Section 80
the impugned order is set aside, appeal is allowed