Custom, Excise & Service Tax Tribunal
M/S Diamond Cable Network vs C.C.E., Jaipur on 30 September, 2009
CUSTOMS EXCISE & SERVICE TAX APPELLATE TRIBUNAL, West Block No.2, R.K.Puram, New Delhi COURT-III Date of hearing/decision: 30.9.2009 Service Tax Appeal No.712 of 2007-SM Arising out of the order in appeal No.162(RKS)ST/JPR-I/07 dated 19.9.07 passed by the Commissioner (Appeals I), Customs & Central Excise, Jaipur. For Approval and Signature: Honble Shri M. Veeraiyan, Member (Technical) 1 Whether Press Reporter may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982? No 2 Whether it should be released under Rule 27 of CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? 3 Whether their Lordships wish to see the fair copy of the Order? Seen 4 Whether Order is to be circulated to the Departmental authorities? Yes M/s Diamond Cable Network . Appellant Vs. C.C.E., Jaipur . Respondent
Appearance:
Shri Atul Gupta, Company Secretary for the appellant(s) Shri Sunil Kumar, Authorized Departmental Representative (JDR) for the Revenue Coram: Honble Shri M. Veeraiyan, Member (Technical) Oral Order No.____________________ Per M. Veeraiyan:
This is an appeal against the order of the Commissioner (Appeals) No. 162(RKS)ST/JPR-I/07 dated 19.9.07 by which the order of the original authority demanding service tax of Rs.1,14,586/- along with interest and imposition of penalty of Rs.1,14,586/- under Section 76, Rs.1,14,568/- under Section 78, Rs.500/- under Section 77 of the Finance Act, 1994 has been upheld.
2. Heard both sides.
3. Learned Company Secretary submits that they are not disputing the liability of service tax and interest. He submits that the appellant is a small time cable network operator and was facing severe financial crisis and therefore, there has been default in payment of service tax. Further, during that time, there was dispute relating to taxability of the impugned service. He also submits that the entire amount of service tax and interest stands paid before issue of show cause notice. He seeks waiver of penalty under Section 80 of the Finance Act, 1994.
4. Learned DR submits that this is a case where the appellants registered themselves for payment of service tax on 31.3.2003 and they were paying service tax thereafter. Therefore, the claim that they entertained bona fide belief that service tax was not payable during the period October, 2004 to December 2004 cannot be accepted at all. He relies on the decision of the Tribunal in the case of C.C.E., Jaipur I vs. Science Center reported in 2008 (9) STR 138 (Tri-Del.), UOI vs. Dharmendra Textile Processors reported in 2008 (231) ELT 3 (SC), Assistant Commissioner of Central Excise vs. Krishna Poduval reported in 2006 (1) STR 185 (Ker.), Krishna Textiles vs. C.C.E., Vadodara reported in 2007 (212) ELT 41 (Tri-Mumbai and submits that the penalties imposed should be sustained.
5. I have carefully considered the submissions from both sides and perused the record. The appellant is not disputing the service tax liability and order for interest. The appellant is seeking the benefit under Section 80 of the Finance Act, 1994. I find that the appellants registered themselves as service tax assessee on 31.3.2003 and were paying service tax though, in some cases, there was some delay. However, I do not find any justification for not paying service tax from October, 2004 to December, 2004. However, the appellants submit that they are small time cable operator and they were facing financial crisis especially in the initial stage of introduction of service. I find that penalty of Rs.1,14,586/- has been imposed under Section 76 as well as under Section 78 separately. In the given facts and circumstances of the case, separate penalty under Section 78 may not be warranted. The decisions relied upon by the learned DR are mainly relating to Customs Act and Central Excise Act. While considering the penal provisions under the Finance Act, 1994, one should take into account the existence of Section 80 of the Finance Act. In the present case, no evidence of suppression or misstatement has been relied upon. The appellant was registered and was paying service tax for initial period and raised the dispute for the subsequent period. Therefore, some leniency is warranted. The separate penalty under Section 78 is not justified in the facts and circumstances of the case. Further, I reduce the penalty imposed under Section 76 from Rs.1,14,586/- to Rs.50,000/- (rupees fifty thousand). The penalty imposed under Section 77 is not interfered with.
6. The appeal is disposed of on the above terms.
(M. Veeraiyan) Member (Technical) scd/