• Mar
  • 16
  • 2013

Ignorance of Law cannot be an excuse to avoid penalty & to extend limitation period

CESTAT, CHENNAI BENCH

P. Raman

Versus

Commissioner of Central Excise

FINAL ORDER NOS. 916-919 OF 2012
APPEAL NOS. ST/536,537,547 & 548 OF 2012

SEPTEMBER  6, 2012

ORDER

1. Despite notice none appeared nor have any requests for adjournment been received. As the issue involved is of narrow compass, therefore all the appeals are taken up together for final disposal.

2. Perused the records and heard the learned SDR. The facts of the case are that the appellants are engaged in the activity of construction of complex for BSNL. Revenue is of the view that the said activity is to be taxed under the category of ‘Commercial and Industrial Construction Services’. The contention of the appellant is that they are covered under Works Contract service. Therefore, they are not liable to pay service tax prior to 1-6-2007. A show-cause notice was issued involving extended period of limitation and thereafter adjudication took place and it was held that the appellants are liable to pay service tax under “Commercial and Industrial Constructions Services”. The said order was challenged before the first appellate authority who held that appellants are liable to pay service tax under Works Contract with effect from 1-6-2007 and also held that as the appellants did not take any steps themselves to get registered under Works Contract Services, therefore extended period of limitation is invocable as well as they are liable to pay penalty also. The appellants are aggrieved only on the part of the order wherein extended period of limitation has been invoked and penalties are also confirmed against the appellants. The ground of the appellants is that benefit under section 80 of the Finance Act, 1994 be extended to them.

3. Considered the pleas taken by the appellants in their appeals and the argument advanced by the learned SDR. It is an admitted fact that the appellants are liable to pay service tax under Works Contract services with effect from 1-6-2007 and the appellants did not get themselves registered with the service tax department from 1-6-2007. The ground taken by the appellants is that they were not aware of the fact that they are liable to pay service tax under works’ contract with effect from 1-6-2007 is not sustainable, as ignorance of law is not an excuse. Further, the activity of the appellants has been detected by the Department during the course of investigation. Therefore, I do agree with the findings of the first appellate authority for invoking extended period of limitation. Therefore, I do not find any infirmity in the impugned orders and the same are upheld and the appeals filed by the appellants are dismissed.


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