Case Law Details
CESTAT, CHENNAI BENCH
G. Kannan
Versus
Commissioner of Central Excise (Service Tax), Madurai
Ashok Jindal, JUDICIAL MEMBER
FINAL ORDER NOS. 928-930 OF 2012
APPEAL NOS. ST/454 TO 456 OF 2012
SEPTEMBER 13, 2012
JUDGMENT
1. The appellants are seeking waiver of penalties under Section 78 of the Finance Act, 1994 on the premise that they have paid service tax before issuance of the show-cause notice. Further, they also contended that they being individuals are providing service in the remote area of Tamil Nadu, as such they are not aware of the provisions of Finance Act, 1994.
2. The facts of the case are that from 16.05.2006 anybody providing any service is made liable to pay service tax, whether he is an individual or a commercial concern. In October, 2006 investigation took place, wherein it was found that the appellants have not paid service tax for the period May, 2006 to September, 2006. Therefore, summons were issued to the appellants and upon receiving of the summons, the appellants paid service tax along with interest and got themselves registered with effect from Jan.’07 with the service tax department under the category of “Manpower Supply and Recruitment Services”. It is the contention of the appellants that as they have paid the service tax along with interest before issuance of the show-cause notice and as appellants are living in a remote area of Tamil Nadu, where no infrastructural facilities such as telecommunication etc., are available freely, penalty under section 78 of the Finance Act, 1994 be waived.
3. Heard both sides and considered their submissions.
4. After hearing both sides and considering their submissions, I am of the view that ignorance of law is no excuse and the case law relied upon by the learned counsel in the case of CCE v. Padavary Cable Network [2009] 23 STT 128 (Bang.-Cestat) is not applicable to the facts of this case as in the above cited case, the appellants were not aware of the fact that the ‘link operator’ is required to get registered under service tax and pay service tax.
5. Considering the fact that the entire amount of service tax and interest has been paid before the issuance of the show-cause notice, I reduce the penalty under section 78 to 25% of the service tax but confirm the penalty imposed under section 77 by the impugned orders. The appellants are directed to pay penalty under section 78 confirmed by this order within 30 days of the communication of this order. Failing which, the appellants shall be liable to pay 100% of penalty as imposed in the impugned orders. The appeals are disposed of in the above terms.
