Commissioner of GST & Central Excise Vs Artemis HR Services Cbe (P) Ltd. (Madras High Court)
Summary: The Madras High Court dismissed C.M.A.Nos.3329 and 3333 of 2019 filed by the Commissioner of GST & Central Excise against M/s. Artemis HR Services Cbe (P) Ltd., thereby upholding the CESTAT’s decision to waive penalties imposed under Sections 76 and 78 of the Finance Act, 1994 by invoking Section 80. The supplied judgment was pronounced on 27 July 2026.
The appeals arose from Final Order No.40055-40058/2019 dated 14 January 2019 passed by the CESTAT, South Zonal Bench, Chennai. The Tribunal had allowed the assessee’s appeals to the extent of penalties under Sections 76 and 78, while leaving the service tax and interest demand undisturbed. The Tribunal had also interfered with the adjudication and appellate orders only in relation to the penalties under Sections 76 and 78, with the penalty under Section 77 remaining undisturbed.
The dispute concerned short-payment of service tax under the category “Business Support Service”. The departmental officers had inspected the respondent’s premises on various dates between 12 March 2009 and 30 April 2009 and found short-payment of service tax. The assessee explained that the short-payment was not due to any wilful intention but resulted from financial incapacity caused by substantial outstanding dues from its clients, particularly M/s. Rank Investments and Credits (India) Ltd. The Tribunal accepted this explanation and reversed the findings of the Assessing Officer and Appellate Authority concerning the penalties.
