Case Law Details
Urvashi Porwal
Brief of the Case
In the case of Principal Commissioner of Service Tax V/S Tops Security Ltd , it was held that an appellate authority cannot at the appellate stage give the option to an Assessee to pay the reduced penalty within a time that is beyond what is stipulated in the third proviso to Section 78 (1) of the Finance Act, 1994. The option to pay the reduced penalty comes to an end on the expiry of thirty days from the date of communication of the adjudication order. It is only where the service tax is enhanced by an appellate authority that, in terms of the proviso to Section 78 (2) of the Finance Act, 1994, the time period for paying the reduced penalty at 25% of such enhanced service tax is computed from the date of communication of the appellate order.
Brief Facts of the Case
Tops Security Limited, is engaged in the business of providing security services. An investigation carried out by the Directorate General of Central Excise Intelligence revealed that the Respondent was charging and collecting service tax from its clients but the service tax that was paid was not commensurate with the amount received for the services rendered. Accordingly, a Show Cause Notice (SCN) dated 20th October, 2009 was issued to the Respondent by the Commissioner of Service Tax for the period 2004-05 to 2008-09 by invoking the extended period and proposing penalty under Section 78 of the Finance Act, 1994. Subsequently, SCN dated 10th April, 2011 for the period 2009-10 and another SCN dated 20th October, 2011 to the period 2010-11 were also issued. In these SCNs penalty under Section 76 of the Finance Act, 1994 was proposed.
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