𝗖𝗘𝗦𝗧𝗔𝗧 𝗖𝗵𝗮𝗻𝗱𝗶𝗴𝗮𝗿𝗵 𝗥𝘂𝗹𝗶𝗻𝗴 𝗼𝗻 𝗦𝗲𝗹𝗳-𝗽𝗮𝘆𝗺𝗲𝗻𝘁 𝗼𝗳 𝗧𝗮𝘅 𝗮𝗻𝗱 𝗣𝗲𝗻𝗮𝗹𝘁𝘆 𝗪𝗮𝗶𝘃𝗲𝗿 📢 𝗧𝗵𝗲 𝗧𝗿𝗶𝗯𝘂𝗻𝗮𝗹 𝗿𝘂𝗹𝗲𝗱: "Penalty under Sections 77 and 78 cannot be imposed when the appellant has suo-moto paid service tax with interest prior to the issuance of a show cause notice."

🔍 𝗙𝗮𝗰𝘁𝘀: 𝗖𝗼𝗺𝗽𝗮𝗻𝘆: M/s GSKCH Employees Co-Operative Canteen Ltd. 𝗜𝘀𝘀𝘂𝗲: Can penalties be imposed when service tax and interest have been voluntarily paid before any show cause notice was issued?

📝 𝗝𝘂𝗱𝗴𝗺𝗲𝗻𝘁: The Tribunal held that penalties under Sections 77 and 78 of the Finance Act cannot be imposed if service tax and interest are paid proactively before a show cause notice is issued. In this case, the appellant’s voluntary payment demonstrated good faith, resulting in penalty waivers and a favorable appeal outcome.

📜 𝗖𝗮𝘀𝗲 𝗜𝗻𝗳𝗼𝗿𝗺𝗮𝘁𝗶𝗼𝗻: 𝗧𝗶𝘁𝗹𝗲: M/s GSKCH Employees Co-Operative Canteen Ltd. vs. Commissioner of Central Excise, Chandigarh II 𝗦𝗲𝗿𝘃𝗶𝗰𝗲 𝗧𝗮𝘅 𝗔𝗽𝗽𝗲𝗮𝗹 𝗡𝗼. 1555 of 2011 𝗢𝗿𝗱𝗲𝗿 𝗗𝗮𝘁𝗲: 02 August 2023 📜 This ruling reinforces that penalties cannot be imposed on entities that voluntarily comply by paying service tax and interest, thereby encouraging timely self-assessment and rectification by taxpayers.