Custom, Excise & Service Tax Tribunal
Cce, Madurai vs Er Ulavan Ura Depot on 5 February, 2009
IN THE CUSTOMS, EXCISE & SERVICE TAX
APPELLATE TRIBUNAL
SOUTH ZONAL BENCH AT CHENNAI
Appeal No. S/2/2006
(Arising out of Order-in-Appeal No. 231/2005 dated 28.11.2005 passed by the Commissioner of Central Excise (Appeals), Madurai)
For approval and signature:
Honble Shri P. Karthikeyan, Member (Technical)
1. Whether Press Reporters may be allowed to see the Order for Publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?
2. Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
3. Whether the Member wishes to see the fair copy of the Order?
4. Whether Order is to be circulated to the Departmental authorities?
CCE, Madurai Appellant
Vs.
Er Ulavan Ura Depot Respondents
Appearance Shri M.K.A.K. Mohiddin, JDR for the Appellant None for the Respondents CORAM Honble Shri P. Karthikeyan, Member (Technical) Date of Hearing: 05.02.2009 Date of Decision: 05.02.2009 Final Order No. ____________ The impugned order affirmed demand of service tax of Rs.23,414/- from the respondents found to have been due towards service tax under the head Clearing & Forwarding Agents during the period May 2001 to March 2003. The respondents paid an amount of Rs.7,631/- along with applicable interest before proceedings were initiated by the Department to recover the short-paid tax. The balance amount also had been paid subsequently along with the interest due. The original authority imposed penalties on the appellants u/s 75A, 76 and 77 of the Finance Act, 1994 (the Act). Penalties imposed were Rs.500/- u/s 75A, Rs.1,000/- u/s 77 and penalty at the rate of Rs.100/- per day for the delay in payment of the arrears u/s 76 of the Act. In the impugned order the Commissioner (Appeals) modified the penalty imposed u/s 76 of the Act to Rs.2,000/-. In so reducing the penalty imposed by the original authority the first appellate authority had taken into account a confusion that existed during the material period, the part payment of the dues made by the respondents before issue of the show-cause notice and also the ratio of a decision of the Tribunal in CCE, Bangalore Vs. S.B. Gopalakrishna reported in 2004 (164) ELT 185 (Tri. Bang.). In challenging the reduction of penalty, the Revenue relied on a judgment of the Honble High Court of Rajasthan in Union of India Vs. Aakar Advertising [2008 (11) STR 5 (Raj.)]. In the above judgment their lordships held as follows:-
If reasonable cause is not shown, and penalty is required to be levied, then, the minimum penalty prescribed cannot be further reduced, under the garb of any existing discretion; assumed to be vesting with the authority, including the Tribunal. Where the two limits have been prescribed, being the minimum and upper limit, then obviously the free play is available between the two limits only, and the discretion can be exercised within those limits, but then that does not mean, that the authorities have any power to impose penalty less than the minimum prescribed by the section.
2. On 27.1.1999 the impugned order was upheld and the appeal filed by the Revenue was dismissed. However, it appeared that in terms of the judgment of the High Court of Rajasthan the Commissioner (Appeals) had reduced the penalty contrary to the statutory provisions contained in Section 76 of the Act. Once penalty was found to be imposable u/s 76 the same could be only Rs.100/- per day or Rs.200/- per day for the duration of the delay in paying the arrears. Accordingly, the case was recalled.
3. The respondents are not represented. They have submitted a letter enclosing copies of challans evidencing payments of the dues as per the impugned order. They have paid the arrears of service tax of Rs.14,514/- on 17.2.2006 and the penalties as per the impugned order on 23.2.2006. They paid the interest due of Rs.2,531/- on 7.10.2008. They have also submitted a copy of the certificate issued by the designated authority for full and final settlement of tax arrears u/s 96(2) of the Finance Act, 2008 under the Dispute Resolution Scheme, 2008. As per the certificate the respondents paid an amount of Rs. 2,531/- complying with the order dated 29.9.2008 issued by the designated authority and the payment was towards full and final settlement of tax arrears determined in the said order. As per the certificate the respondents were granted immunity from institution of any proceeding for imposition of penalty under the Act in respect of matters covered in the declaration filed by the respondents.
4. The learned JDR submits that as per the Dispute Resolution Scheme, 2008 announced by the Ministry of Finance any pending appeal shall stand withdrawn once the arrears of service tax, penalty, interest etc are paid in terms of the scheme and a certificate issued by the designated authority in terms of sub-section (2) of Section 96 of the Finance Act, 2008. I find that the respondents have not claimed any relief of paying lower amount of tax or penalties or tax as per the scheme. They have discharged all the adjudged dues. As per the certificate dated 7.10.2008 issued by the designated authority no dues survive to be paid by the respondents. In the circumstances the appeal is dismissed as withdrawn under Dispute Resolution Scheme.
(Dictated and pronounced in open court) (P. KARTHIKEYAN) Member (T) Rex ??
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