Custom, Excise & Service Tax Tribunal
4. Whether Order Is To Be Circulated To ... vs Unknown on 23 October, 2009
IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL
WEST ZONAL BENCH AT AHMEDABAD
COURT-II
Appeal No.ST/316/09
Arising out of OIA No.412/(356)RAJ/2009/COMMR(A)/RAJ, dt.12.05.09
Passed by: Commissioner of Central Excise (Appeals), Rajkot
For approval and signature:
Honble Mr. B.S.V. Murthy, Member (Technical)
1. Whether Press Reporters may be allowed to see the No
Order for publication as per Rule 27 of the CESTAT
(Procedure) Rules, 1982?
2. Whether it should be released under Rule 27 of the No
CESTAT (Procedure) Rules, 1982 for publication
in any authoritative report or not?
3. Whether their Lordships wish to see the fair copy of Seen
the order?
4. Whether order is to be circulated to the Departmental Yes
authorities?
Appellant/s CCE Rajkot
Represented by Shri R. Nagar (SDR)
Vs.
Respondent/s M/s. S.J. Mehta
Represented by None CORAM:
MR. B.S.V. MURTHY, MEMBER (TECHNICAL) Date of Hearing:23.10.09 Date of Decision:23.10.09 ORDER No. /WZB/AHD/2009 Per: B.S.V. Murthy:
During the course of scrutiny of ST-3 returns for the period from April, 2006 to September, 2006 of M/s. S.J. Mehta & Co., Jamnagar (hereinafter referred to as the appellants) it was observed that the same was filed with a delay of 180 days and also there was a delay of 268 days for payment of service tax for the quarter of April, 2006 to June, 2006 and a delay of 176 days for the quarter of July, 2006 to September, 2006.
2. Due to delay in filing of statutory return and late payment of service tax, the provisions of the Service Tax Rules and Regulations were contravened and therefore a show cause notice dated:15.04.2008 was issued by the Assistant Commissioner, Service Tax Division, Rajkot (hereinafter referred to as the Lower Authority) wherein it was proposed to impose penalty under Section 76 & 77 of the Finance Act, 1994.
The said show cause notice dated: 15.04.2008 was adjudicated by the Lower authority vide his Order in Original No:202/Service Tax/2008 dated: 28.11.2008 (hereinafter referred to as the impugned order) imposed penalty @ Rs.200/- for total delay of 444 days i.e. Rs.88,800/- under Section 76 of the Finance Act, 1994 and also imposed penalty of Rs.1,000/- under Section 77 of the Finance Act, 1994.
3. On an appeal filed by the party, Commissioner (Appeals) in the impugned order upheld the demand for service tax but reduced the penalty under Section 76 of the Finance Act, 1994 to Rs.25,000/-.
4. The Revenue is in appeal against the lenient view taken by the Commissioner (Appeals) as regards penalty leviable by resorting the Provisions of Section 80 of the Finance Act, 1994 on the ground that this case is not a fit case for lenient view under Section 80 of the Finance Act, 1994.
5. Nobody has appeared on behalf of the respondents. Heard the learned DR. He submits that this was not a fit case for reduction of penalty by resorting to Provisions of Section 80 of Finance Act, 1994 and he relies upon the following decisions of the Tribunal in support of his contention that penalty should have been imposed.
1. CCE & STC, Bangalore Vs. First Flight Couriers Ltd. [2007 (8) STR 225 (Kar.)]
2. CCE Delhi Faridabad Vs. ILLPEA Paramount Pvt. Ltd. [2006 (4) STR 416 (P & H)]
3. Union of India Vs. Aakar Advertising [2008 (11) STR 5 (Raj.)]
4. ETA Engineering Ltd. Vs. CCE Chennai [2006 (3) STR 429 (Tri. LB)]
6. I have considered the submissions made by learned DR and the memorandum of appeal. I find that the Commissioner has considered the issue and for better appreciation I reproduce the relevant paragraphs of the order.
14. As regards to the imposition of penalty under Section 76 & 77 of Finance Act, 1994 I find that appellants have stated that there was ambiguity in their mind as regards to taxability of their service and hence they have paid the Service Tax late as they were under the impression that since the Service Tax has been collected from them by the principle they are not liable for Service Tax.
I find that there is a ample force in the argument since the receipt of the principle would mislead a trader like the appellants and therefore it calls for lenient view as regards to imposition of penalty under Section 76 of Finance Act, 1994 by virtue of Section 80 of Finance Act, 1994.
I rely the CESTATs judgment in the case of CCE, Rajkot V/s. Shri B.S.G.K. Shastry in Appeal No:Service Tax/120, 121/2008, CCE, Rajkot V/s. Port Officer, Okha in Appeal No:Service Tax/126/2008 wherein it has been held that penalty under Section 76 of Finance Act, 1994 can be reduced or set aside under Section 80 of the Finance Act, 1994.
15. In view of the above discussions and findings, I pass the following order:
(i) I hold that the service rendered by the appellants are classifiable under Business Auxiliary Services;
(ii) I reduce the penalty of Rs.88,800/- imposed under Section 76 of the Finance Act, 1994 to Rs.25,000/- by under Section 80 of Finance Act, 1994; and
(iii) I uphold the Lower Authoritys impugned order imposing penalty of Rs.1,000/- under Section 77 of Finance Act, 1994.
7. I agree with the rationale adopted by the Commissioner (Appeals) in coming to the conclusion that the respondents deserve a lenient treatment by resorting to the Provisions of Section 80 of Finance Act, 1994. Therefore, I find no reason to interfere with the decision of Commissioner (Appeals) and accordingly reject the appeal filed by the Revenue.
(Dictated & Pronounced in Court) (B.S.V. Murthy) Member (Technical) jk ??
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