Custom, Excise & Service Tax Tribunal
M/S. Tirupur Container Terminals Pvt. ... vs Cce & St, Coimbatore on 27 June, 2016
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL SOUTH ZONAL BENCH
CHENNAI
ST/35/2008
[Arising out of Order-in-Appeal No. 22/2007 - ST dated 18.12.2007 passed by the Commissioner of Customs, Central Excise & Service Tax (Appeals), Coimbatore).
M/s. Tirupur Container Terminals Pvt. Ltd. : Appellant
Versus
CCE & ST, Coimbatore : Respondent
Appearance:
Shri Joseph Prabakar, Advocate, For the Appellant Shri K.P. Muralidharan, AC (AR) For the Respondent CORAM :
Honble Shri P.K. Choudhary, Judicial Member Date of Hearing : 26.05.2016 Date of Pronouncement : 27.06.2016 FINAL ORDER No. 41037 / 2016 M/s. Tirupur Container Terminals Pvt. Ltd., the appellant herein are registered under the service tax department for providing services under the category of Cargo Handling and Goods Transport Agency service. It was alleged by the department that they did not pay service tax on the impugned services rendered by them during the period from 01.12.2005 to 30.10.2006. Further they have not filed ST-3 returns for the above said services for the period Dec.,2005 to Oct.,2006, whereby they have contravened the provisions of Section 68 & 70 of Chapter V of the Finance Act, 1994 and the provisions of Rules 6 & 7 of the Service Tax Rules, 1994. A Show cause notice dated 23.04.2007 was issued proposing a demand of service tax amount of Rs.49,69,470/- for the period 01.12.2005 to 31.10.2006 along with interest and proposing penalty under Section 76, 77 of the Finance Act, 1994. On adjudication, the Additional Commissioner confirmed the demand of Rs. 12,42,368/- along with interest and appropriated an amount of Rs.5,43,594/-, Rs.10,872/-, Rs.67,966/-, Rs.4,56,473/-, Rs.9,129/- and Rs.46,860/- already paid by them. Further, he imposed penalties under Section 76 and 77 of the Finance Act, 1994, for non-payment of service tax and for non-filing of ST-3 return. On appeal, the Commissioner (Appeals) dismissed their appeal on the ground that the appellants have not shown the reasonable cause as contemplated under Section 80, for the failure to pay the service tax. Hence the present appeal.
2. Ld. Counsel Shri Joseph Prabakar, Advocate, appearing on behalf of the appellant submitted that the appellant had misinterpreted the provisions and hence erred in depositing the service tax in time. He further submitted that a substantial amount of service tax was paid along with interest before the adjudication of the show cause notice and stated that they are before the Tribunal only on the penalty aspect. Hence, he prayed that the penalties may be set aside.
3. Ld. AR, Shri K.P. Muralidharan, AC, appearing on behalf of the department submitted that it has been established that they have contravened the provisions of Section 68 of Finance Act, 1994 read with Rule 6 of Service Tax Rules, 1994, in as much as they have failed to pay the service tax for availing the services of GTA for the period Dec. 2005 to Oct. 2006. Hence, the adjudicating authority has rightly confirmed the demand along with interest after appropriating the service tax paid by them. Since, the appellants were not able show a reasonable cause for the failure to pay the service tax on the impugned service the Commissioner (Appeals) has rightly denied the relief. He relied on the judgement of the Honble High Court of Rajasthan in the case of UOI & Anr Vs. AAKAR Advertising reported in 2008-TIOL-303-HC-RAJ-ST, wherein on similar circumstances the Honble High Court held in favour of the Revenue, after setting aside the impugned order, remanded the matter to the adjudicating authority to decide the quantum of the penalty amount under Section 76. Hence, he prayed that the appeal may be remanded back to the adjudicating authority.
4. Heard both sides and perused the records. The short issue involved in this appeal is the penalty aspect. On perusal of the Reconciliation statement of service tax paid by the appellant, shows that they have remitted Rs. 12,42,822/- vide six TR -6 Challans dated 30.05.2007, 09.05.2007, 03.03.2007, 09.02.3007, 05.01.2007 and 29.08.2007. On perusal of the Order-in-Original, I find that the Order was passed on 06.08.2007. It shows that except for Rs. 1,02,367/-, which was paid on 29.08.2007, entire amount paid vide other challans were well before the adjudication order passed. The adjudicating authority has already appropriated the amount paid under various challans in his Order-in-Original. Hence, to decide the quantum of the penalty amount under Section 76 is to be arrived only on Rs. 1,02,367/- paid on 29.08.2007. The ld. Commissioner (Appeals) denied the relief from penalty in terms of Section 80, as they were not able to substantiate failures to pay the service tax and of non-filing of ST-3 return. I find that both the authorities below dealt the issue in detail and were not satisfied with the reason adduced by the appellant for their failure to pay the service tax and for non-filing of return. Moreover, the Commissioner (Appeals) in his order substantiated the levy of penalty by relying on case laws and stated that the penalty levied is reasonable and does not require any modification. The case law relied on by the Ld. AR depicts that on similar issue and on similar circumstances, the Honble High Court of Rajasthan had remanded the matter to the adjudicating authority to decide the quantum of penalty involved in that appeal. Hence, in the instant case, to decide the quantum of penalty on Rs. 1,02,367/- paid vide challan dated 29.08.2007, it is apt to remand the matter to the adjudicating authority. Therefore, the appeal is remanded back to the adjudicating authority to decide the quantum of penalty on Rs.1,02,367/- under Section 76. As regards imposition of penalty under Section 77 of the Finance Act, 1994, it is upheld since the appellants have failed to submit the ST-3 returns for the period under dispute.
5. In view of the foregoing discussions, Section 77 penalty is upheld and the matter is remanded to the adjudicating authority to decide the quantum of penalty on Rs. 1,02,367/- paid for the period May, 2006 vide challan dated 29.08.2007. The appeal is disposed of in the above terms.
(Order Pronounced in the open Court on_27.06.2016) (P.K. CHOUDHARY) JUDICIAL MEMBER BB 5