Custom, Excise & Service Tax Tribunal
The Karur Vysya Bank Ltd vs Commissioner Of Central Excise And on 2 November, 2017
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNALSOUTH ZONAL BENCH CHENNAI Appeal No.ST/41983/2017 [Arising out of Order-in-Appeal No.41/2017dt.3.04.17passed by the Commissioner of Customs and Central Excise (Appeals-2), Tiruchirapalli] The Karur Vysya Bank Ltd. Appellant Versus Commissioner of Central Excise and Service Tax, Chennai Respondent
Appearance:
Ms.Sweta Giridhar, Advocate For the Appellant Shri Arul C Durairaj, Superintendent (AR) For the Respondent CORAM :
Honble Ms. Sulekha Beevi C.S. Member (Judicial) Date of hearing / decision : 2.11.2017 FINAL ORDER No. 42757 / 2017 The appellant were providing taxable services and was issued Show Cause Notice alleging non-payment of service tax on ATM services. The appellants had paid the service tax along with interest on 31.3.2011 much before the issuance of Show Cause Notice. The original authority dropped the penalty observing that the appellant has paid the service tax prior to issuance of Show Cause Notice. The department filed appeal before the Commissioner (Appeals) for imposing equal penalty under section 78 of the Finance Act as well as penalty under section 77. The Commissioner (Appeals) vide order impugned herein imposed penalties. Being aggrieved the appellants are now before the Tribunal.
2. On behalf of the appellant, the Ld.Counsel, Ms.Sweta Giridhar submitted that the appellant had paid the service tax along with interest immediately on being pointed out by the department. That as per sub section (3) of Section 73, no Show Cause Notice ought to have been issued to the appellant and therefore the penalties imposed are not sustainable. She relied upon the decision of the Hon'ble High Court of Karnataka in the case of Adecco Flexione Workforce Solutions Ltd 2012 (26) STR 3 (Kar.)
3. The Ld.AR, Shri Arul C Durairaj, reiterated the findings in the impugned order.
4. Heard both sides.
5. Undoubtedly, the appellant has paid the service tax much before the issuance of Show Cause Notice and the original authority has appropriated the same vide Order in Original. On such score, the penalty imposed under section 77 as well as section 78 is unwarranted in terms of sub section (3) of Section 73 of Finance Act, 1994 as well as the ratio laid by the Hon'ble High Court of Karnataka in the case stated supra as rightly submitted by the Ld.Counsel for appellant.
6. In the result, the impugned order to the extent of imposing the penalty under section 77 and section 78 is set aside. The appeal is allowed with consequential reliefs, if any.
(Dictated and pronounced in open court) (Sulekha Beevi C.S) Member (Judicial) Vsr 3 1