Customs, Excise and Gold Tribunal - Delhi
Centrum Travels Pvt. Ltd. vs C.C.E. on 5 October, 2006
Equivalent citations: 2007[6]S.T.R.254, [2007]8STT340
ORDER C.N.B. Nair, Member (T)
1. This appeal is directed against confirmation of penalty of Rs. 6,3 8,000/- against the appellant under Section 76 of Finance Act, 1994.
2. The facts of the case are that the appellant was liable to pay service tax in regard to air travel agency service rendered by it. However, full tax was not paid at the appropriate time during the period Sept.'02 to March, 2004. Returns were also not filed.
3. Delayed payment of the outstanding tax alongwith interest was made. A SCN was issued proposing to impose penalty under Section 76 of the Finance Act, 1974. The appellant contended that delay in payment of tax was on account of financial difficulties and since tax has been paid along with interest, no penalty may be imposed. In adjudication, the aforesaid penalty was imposed.
4. The submission of the appellant is that since tax alongwith interest was deposited even before the issuance of SCN, no penalty is warranted. Reliance in this connection is being placed on the judgments of this Tribunal in the case of Mass Marketing & Advertising Services Pvt. Ltd. v. CCE, Bangalore reported in 2006 (75) RLT. 50 and CCE, Bhopal v. Bhojpur Club reported in 2006 (75) RLT. 446 (CESTAT, Del.). Ld. Counsel would also rely on the scheme launched by the Finance Minister in Sept'04 for enabling service tax defaulters to discharge service tax liability without any penal liability till 30.10.04. The submission is that since the appellant had paid the entire tax and interest before the expiry of the scheme, penalty is not justified.
5. The contention of the revenue is that the appellant had a turn over of over Rs. 28 crores during the relevant period and the service tax was not being paid despite it being collected from buyers. Therefore, penalty is fully justified.
6. It is to be seen that the Division Bench of the Tribunal held in the case of Mass Marketing & Advertising Services Pvt. Ltd. (supra) that even interest is not leviable when service tax was paid before issuance of SCN. Similarly, in the case of Bhojpur Club, the Commissioner had dropped penalty proceedings in view of the fact that the appellant had deposited the tax before issuance of SCN and in view of the scheme of Sept'04 for payment of service tax arrears and waiver of penalties. Under the aforesaid order, this Tribunal rejected the appeal filed against that order by the revenue. Thus, the orders of the Tribunal as well as the scheme for mobilization of service tax arrears are in favour of setting aside the penalty. Following these, the penalty imposed is set aside and the appeal is allowed.
Order pronounced in the open Court on 9.2.07