Suvendu Kumar Pati ORDER
Dr. Suvendu Kumar Pati, Member (J)
1. Order passed by the Commissioner of CGST & CE, (Appeals), Raigad setting aside the penalty imposed by the adjudicating authority on the respondent under section 77 and 78 of the Finance Act read with 15(3) of Cenvat Credit Rules is assailed by the appellant department before this forum.
2. Factual backdrop of the case, in a nutshell, is that respondent Reliance Infocomm Infrastructure Ltd. was pointed out by the audit team to have availed ineligible cenvat credit of ` 23,98,774/- on "business support service" and "renting of immovable property service." Between the Financial year 2009-10 and 2011-12, it was also discovered by the said EA 2000 audit that there was mismatch between profit and loss account and balance sheet with ST-3 returns for the Financial year 2010-11 and reconciliation of the same brought a difference of ` 48,69,069/- in the taxable value which was less shown in the ST-3 returns and accordingly service tax liability of ` 5,01,483/- was calculated. In compliance to such audit observation, appellant discharged duty liability along with interest for both components but was subsequently vide notice dated 31.03.2013 was put to show-cause for alleged suppression with a proposal for imposition of penalty under section 76, 77 and 78 of the Finance Act r/w Rule 15(3) of the Cenvat Credit Rules. Matter was adjudicated upon, penalty equivalent to duty demand was confirmed under section 78 and penalty of ` 7000/- was imposed under section 77 of the said Act by the adjudicating authority who set aside only proposed penalty under section 76 of the Act. Matter was taken to the Commissioner (Appeals) by the respondent who set aside the penalty on all scores. The said order is being challenged here by the appellant department.
3. In the memo of appeal and during course of hearing of the appeal, learned AR for the department submitted that the order passed by the Commissioner (Appeals) is erroneous inasmuch as the finding of which he arrived at such conclusion is illogical. While admitting that show-cause notice does not reveal that proviso to Section 73(1) was invoked for imposition of penalty under section 78 of the Finance Act. Learned AR Shri Suresh submitted that during the corresponding period 2009 to 2012 no such provision in the Finance Act 1994 other than Section 73(1) or Rule 15 of Cenvat Credit Rules 2004 could be pressed into service to make such demand in the show-cause for which Section 73(1) is implicit in the show-cause though not expressly referred inasmuch as Section 15(3) of the Cenvat Credit Rules was invoked in the show-cause notice itself and ingredient of the offence constituting suppression misstatement and intention to evade payment of service tax on the part of respondent was squarely made out in the OIO as discussed in para 1.3 and 1.4 of the order. He placed his reliance on the order of the CESTAT Ahmedabad bench in the case of Geedelon Texo Twist Pvt. Ltd. reported in <........