Case Law Details
N & N Chopra Consltants Pvt. Ltd Vs Principal Commissioner, Goods & Service Tax & Central Excise (Delhi High Court)
The facts of this case, in the opinion of this court, notes that the assessee was aware about its service tax liability; despite this knowledge, it filed its returns claiming that no liabilities were attracted. When it smelt investigation and adverse orders, it apparently approached the service tax authorities and deposited the amounts which they were admittedly liable to pay. Such being the case of foreknowledge, in the opinion of the court, itself is an important factor that ought to have been and was taken into account by the lower revenue authorities. Hence, foreknowledge lead to the imposition of recovery of dues assessed as well as imposition of the penalty under Section 78. The court is of the opinion that the invocation of Section 78 cannot be faulted with having regard to the facts of this case. Depositing the amount due, by the appellant, before issuance of show cause notice per se does not absolve the appellant of its responsibility to file the returns, since the option of imposing other penalty under Section 76 was exercised. Being a matter of discretion, its judicious exercise, is all that is in question. Having regard to the fact of concurrent findings, we are of the opinion that the exercise of such discretion reserving imposition of Section 76 in the circumstances, does not call for interference.
FULL TEXT OF THE HIGH COURT ORDER / JUDGMENT
The question which the assessee urges in this appeal under Section 35G of the Central Excise Act, 1944, as made by virtue of Section 83 of the Finance Act, 1994, is that the multiple penalties imposed in the circumstances of the case were excessive.
The assessee is engaged in providing commercial coaching and training services and therefore, he is subject to service tax levy under the Finance Act, 1994. It was registered as a service tax assessee and it appears to have not paid up his liability for the period 09.09 .2004 to 31.03.2008, however, he filed its returns stating that there was no service tax liability. The Income Tax Search and Seizure proceedings apparently triggered investigations by the Service Tax Authorities. The Assesssee in these circumstances offered to pay service tax dues and filed returns on 02.03.2009. In the meanwhile, a show cause notice was issued on 23.06.2009. For a later period, the assessee again approached the Service Tax Authorities, conceding its liability and offering to pay up its dues. The show cause notice culminated in order in original dated 06.01.2012. Besides the tax liability, the Learned Commissioner (Adjudication), who adjudicated show cause notice, ordered, imposing penalties. The relevant part of the extract of the &RPPLssioLer’s order reGdU Gs fUlloUs:
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