Case Law Details
Once penalty imposed under Section 78 of the Act, no penalty was imposable under Section 76 of the Act. It has not been shown any appeal has been filed against the said order of the Tribunal and stay granted. The decision of the Hon’ble High Court of Kerala in the case of Krishna Poduval dealt the issue whether Sections 76 and 78 can be invoked to the same transactions. In the said decision, the Hon’ble High Court has also taken note of the fact that powers under Section 80 of the Finance Act, could have been invoked by the Appellate Authority.
The Appellants have also raised the plea for benefit of Section 80 before the Commissioner(Appeals). The ld. Advocate also brought to my notice that in substantially similar situation, the Tribunal has exercised the powers under Section 80 of the Act and therefore setting aside the penalty under Section 76 by the Commissioner (Appeals) cannot be held to be unreasonable. Further, the respondent has admittedly paid 25% of the penalty within one month from the date of the order of the original authority. Therefore, the waiver of penalty in excess of 25% of the Service Tax evaded under Section 78 is also justified and, therefore, order of the Commissioner (Appeals) calls for no interference.
IN THE HIGH COURT OF PUNJAB AND HARYANA
AT CHANDIGARH
Service Tax Appeal No. 50 of 2010
COMMISSIONER OF CENTRAL EXCISE, LUDHIANA
Vs
M/s AKASH CABLE, LUDHIANA
Dated: February 16, 2011
JUDGEMENT
Per: Adarsh Kumar Geol:
1. This appeal has been preferred by the revenue under Section 35G of the Central Excise Act, 1944 against order dated 13.11.2009 passed by the Customs, Excise & Service Tax Appellate Tribunal, New Delhi claiming following substantial question of law:-
“i) Whether Tribunal is justified in extending the benefit of Section 80 of the Finance Act, 1994 when there was no reasonable cause and party had deliberately suppressed the facts from the department and delayed the payment of tax?”
2. Show cause notice dated 25.4.2007 was issued to the assessee alleging deficient payment of service tax. Vide order-in-original, demand for service tax was affirmed and penalties were levied under Sections 76, 77 and 78 of the Finance Act, 1994 (“the Act”). Appeal of the assessee was partly allowed to the extent of reducing the amount of penalty and limiting the penalty only under Section 78 of the Act. This view has been affirmed by the Tribunal as follows:-
“I have carefully considered the submissions from both sides. The tax liability is not in dispute and the same has been paid along with interest. Commissioner(Appeals) relying on the decision of the Tribunal in the case of the Financers (supra) held that once penalty imposed under Section 78 of the Act, no penalty was imposable under Section 76 of the Act. It has not been shown any appeal has been filed against the said order of the Tribunal and stay granted. The decision of the Hon’ble High Court of Kerala in the case of Krishna Poduval dealt the issue whether Sections 76 and 78 can be invoked to the same transactions. In the said decision, the Hon’ble High Court has also taken note of the fact that powers under Section 80 of the Finance Act, could have been invoked by the Appellate Authority. The Appellants have also raised the plea for benefit of Section 80 before the Commissioner(Appeals). The ld. Advocate also brought to my notice that in substantially similar situation, the Tribunal has exercised the powers under Section 80 of the Act and therefore setting aside the penalty under Section 76 by the Commissioner (Appeals) cannot be held to be unreasonable. Further, the respondent has admittedly paid 25% of the penalty within one month from the date of the order of the original authority. Therefore, the waiver of penalty in excess of 25% of the Service Tax evaded under Section 78 is also justified and, therefore, order of the Commissioner (Appeals) calls for no interference.”
Learned counsel for the revenue fairly states that the matter is covered against the revenue by order of this Court dated 12.7.2010 in STA No.13 of 2010 (Commissioner of Central Excise Vs. M/s Pannu Property Dealers, Ludhiana ). Accordingly, no substantial question of law arises.
3. The appeal is dismissed.
