Customs, Excise and Gold Tribunal - Delhi
K.G. Somani And Co. vs Cst on 8 November, 2006
Equivalent citations: 2007(115)ECC43, 2007ECR43(TRI.-DELHI), 2007[5]S.T.R.418, [2007]6STT504
ORDER M.V. Ravindran, Member (J)
1. This appeal is directed against order in appeal dated 06/06/06, which upheld the order in original vide which interest amount was appropriated and penalty of equivalent amount of the service tax was imposed.
2. It is not in dispute that the appellant had delayed the deposit of service tax for the quarter ending October 99 to December 99 and January 2000 to March 2000.
3. Mr. K.G. Somani, C.A., partner of the appellant firm submits that they are challenging only the imposition of penalty on them. They took the registration of the service tax, as soon as the same were introduced for the services rendered by Chartered Accountant, in 1998. It is his submission that prior to these two quarters and subsequent to these two quarters there was no infraction on their part and infraction in these two quarters was absolutely due to over sight as there was no one looking after the job. He pleads for leniency in imposition of penalty on them under the Section of 80 of the Finance Act, 1994.
4. Learned DR submits that in this case the appellant should have been aware of discharge of service tax liability within the time and as they have delayed the discharge of service tax liability for two quarters, consequently penalty is imposable. It is his submission that the amount of penalty imposed is as per the provisions in the law.
5. Considered the submissions made at length by both, sides and perused records. It is seen from the records that the appellants have themselves noticed the error of non-payment of service tax for the two quarters as indicated in the above paragraphs. On detecting the same, the appellant themselves discharged the entire amount of the service tax liability before the same being pointed out by the revenue. I also find from the records that the appellant has discharged the interest liability also on the entire amount of service tax, which was not paid by them. I find that in this case, the appellants have taken the registration under the Finance Act, 1994 as a provider of Chartered Accountant services as soon as it was introduced. I find from the registration certificate that the said certificate was issued to the appellant on 21st December, 1998. It would be relevant to note that the imposition of service tax on chartered accountant services was challenged by the Association of Chartered Accountants, all over India as being unconstitutional, despite this, the appellant took the Service Tax registration certificate and discharged the service tax liabilities correctly prior to the infractions as indicated. This being so, I accept the contentions of the appellant's partner that this infraction was unintentional and hence should be seen with a lenient eye. To my mind, the appellant have made out the reasonable cause under the provisions of Section 80 for setting aside the penalty imposed on them.
6. Accordingly, the impugned order to the extent is relates to the upholding of the penalty on the appellant under Section 76, is liable to be set aside and I do so. Appeal allowed in above terms.
(Dictated and pronounced in the open court)