78. Penalty for suppressing value of taxable service.
Where any service tax has not been levied or paid or has been short-levied or short-paid or erroneously refunded, by reason of —
(a) fraud; or
(b) collusion; or
(c) wilful mis-statement; or
(d) suppression of facts; or
(e) contravention of any of the provisions of this Chapter or of the rules made thereunder with intent to evade payment of service tax,
the person, liable to pay such service tax or erroneous refund, as determined under sub-section (2) of section 73, shall also be liable to pay a
penalty, in addition to such service tax and interest thereon, if any, payable by him, which shall not be less than, but which shall not exceed
twice, the amount of service tax so not levied or paid or short-levied or short-paid or erroneously refunded:
Provided that where such service tax as determined under sub-section (2) of section 73, and the interest payable thereon under section 75, is
paid within thirty days from the date of communication of order of the Central Excise Officer determining such service tax, the amount of
penalty liable to be paid by such person under this section shall be twenty-five per cent. of the service tax so determined :
Provided further that the benefit of reduced penalty under the first proviso shall be available only if the amount of penalty so determined has also
been paid within the period of thirty days referred to in that proviso :
Provided also that where the service tax determined to be payable is reduced or increased by the Commissioner (Appeals), the Appellate
Tribunal or, as the case may be, the court, then, for the purposes of this section, the service tax as reduced or increased, as the case may be,
shall be taken into account :
Provided also that in case where the service tax determined to be payable is increased by the Commissioner (Appeals), the Appellate Tribunal or,
as the case may be, the court, then, the benefit of reduced penalty under the first proviso shall be available, if the amount of service tax so
increased, the interest payable thereon and twenty-five per cent. of the consequential increase of penalty have also been paid within thirty days of
communication of the order by which such increase in service tax takes effect.
Provided also that if the penalty is payable under this section, the provisions of section 76 shall not apply.
Explanation. - For the removal of doubts, it is hereby declared that -
(1) the provisions of this section shall also apply to cases in which the order determining the service tax under sub-section (2) of section 73 relates
to notices issued prior to the day on which the Finance Bill, 2003 receives the assent of the President;
(2) any amount paid to the credit of the Central Government prior to the date of communication of the order referred to in the first proviso or the
fourth proviso shall be adjusted against the total amount due from such person.