CESTAT, KOLKATA BENCH
Commissioner of Central Excise & Service Tax, Siliguri
Order No. A-125(Kol.) of 2012
Appeal No. ST/ 276 of 2010
March 2, 2012
1. This is an appeal filed by the appellant against the Order-in-Appeal No. 18/Slg./2010 dated 25.3.2010 passed by Commissioner of Central Excise (Appeals), Kolkata.
2. The facts of the case in brief are that the appellant is a stockbroker providing stockbroking services and is registered with the Service Tax Department. The said appellant has defaulted in making payment of service tax liability during the period April, 2007 to September, 2007 involving an amount of Rs. 3,66,739/- as service tax and Rs. 7335/- as education cess and Rs. 2,719 as secondary higher education cess. However, he has filed service tax ST-3 Returns during the said period disclosing liability in the returns and mentioned that the amount is payable but not paid. The entire amount of service tax liability was paid by him on September, 2008 along with interest. Thereafter, the show-cause notice was issued to him proposing penalty. The adjudicating authority has confirmed penalty under Section 76 of the Finance Act and imposed penalty of Rs. 99,654/- on the appellant. Aggrieved by the same, the appellant filed an appeal challenging the penalty before the Commissioner (Appeals), who upheld the order of the adjudicating authority. Hence the present appeal.
3. None present for the appellant. However, the appellant has written a letter dated 23.7.2011 making a prayer that in the event, he could not present for hearing, the appeal may be heard on the basis of records available and on the merit of the case.
4. Heard the ld. A.R. (Addl. Commissioner) for the Department, who reiterates the findings of the ld. Commissioner (Appeals) and submitted that the appellant has defaulted in making payment of service tax liability during the relevant period. However, he has fairly conceded that the service tax liability was duly reflected in ST-3 Return filed with the Department before being pointed out by the Department.
5. I have perused the case records and considered the submissions of the ld. A.R. for the Department. I find that the appellant had reflected the service tax liability on account of service provided by him during the period April, 2007 to September, 2007 in the ST-3 Returns filed with the Department. The reason for delay in making payment has been sufficiently explained by the appellant in his reply stating that due to sudden crash in the stock market, the main broker of whom he is the sub-broker, defaulted in making the payment. This has resulted non-payment of service tax liability in time. I find the reason is bona fide in non-payment of service tax in time. I have also noticed that the entire amount of service tax was paid by him in September, 2008 along with interest and he has paid an excess interest of Rs. 325/- before issuance of show-cause notice. It also indicates his bona fideness in discharging service tax liability. Besides, I find that the Service tax liability was not discharged on being detected by the Department, but paid voluntarily pursuant to the disclosure already made in the ST-3 Returns. In the circumstances, I feel that it is a fit case as sufficient cause has been shown by the appellant for invoking Section 80 of the Finance Act, 1994 which the lower authorities had failed to do. In the circumstances, in view of the above findings, I find that this case covered under section 80 of the Finance Act and the penalty on the appellant is not warranted. Consequently, I set aside the orders of the lower authorities and direct waiver of the penalty under Section 80 of the Finance Act. Appeal is allowed.