Page 127 - GSTL_2nd July 2020 _Vol 38_Part 1

2020 ] GHANERAO HOTELS PVT. LTD. v. COMMISSIONER OF CGST, UDAIPUR 45
2. The facts of the case are that the appellant was providing various
taxable services, namely, “Renting of immovable property service”, “Accommo-
dation Service”, “Restaurant Service” etc., and did not obtain Service Tax regis-
tration. As all the services were taxable from July, 2012, on 8-10-2013 the appel-
lant themselves got registered with the Service Tax Department and started pay-
ing Service Tax. In February, 2014, an investigation was started and the appellant
paid an amount of Rs. 8,54,784/- as Service Tax and Rs. 44,207/- as interest. Later
on, a show cause notice dated 18-11-2015 was issued to the appellant by invoking
the extended period of limitation to demand of Service Tax of Rs. 9,38,760/- from
the appellant and along with interest and penalties and fine were also imposed.
The matter was adjudicated, the Adjudicating Authority hold that prior to July,
2012 the appellant was not liable to pay Service Tax, therefore, the demand from
the period prior to July, 2012 was dropped and the remaining demand proposed
in the show cause botice was confirmed along with interest and penalty under
Section 78 of the Act was imposed. Further a fine of Rs. 1,40,000/- also imposed
on the appellant under Rule 7C of Service Tax Rules, 1994. The said order was
challenged by the appellant before the Learned Commissioner (Appeals) who
gave the benefit of threshold limit to the appellant and further reduce the de-
mand of Service Tax but confirmed the penalty under Section 78 of the Finance
Act and fine under Rule 7C of the Service Tax Rules, 1994. Against the order of
imposition of penalty and fine, the appellant is before this Tribunal.
3. The Learned Counsel for the appellant submits that as the appellant
paid Service Tax along with interest before issuance of the show cause notice,
therefore, in terms of Section 73(3) of Finance Act, 1994, no show cause notice
was required to be issued to the appellant, as appellant was not having any mala
fide intention as they have taken Service Tax registration on 8-10-2013, whereas
the investigation started in February, 2014. Therefore, penalty and fine are re-
quired to be dropped.
4. On the other hand Learned AR supported the impugned order.
5. Heard both the sides and considered the submissions.
6. On perusal of the records placed before me I find that it is a fact on
record that appellant availed Service Tax Registration on 8-10-2013, whereas in-
vestigation was started on February, 2014, as appellant started paying Service
Tax of their own after obtaining registration. In that circumstances, I hold that
extended period of limitation it is not invocable, moreover, appellant has paid
Service Tax along with interest before issuance of the show cause notice. In that
circumstances, in terms of Section 73(3) of the Act, no show cause notice was re-
quired to be issued to the appellant.
7. Therefore, proceedings initiated against the appellant through the
impugned show cause notice are set aside. In result, the appeal is allowed to the
extent by dropping the penalty and fine imposed on the appellant in the im-
pugned order. In this terms, appeal is disposed of.
(Dictated and pronounced in open Court)

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GST LAW TIMES  2nd July 2020  127