Cce, Panchkula vs M/S.Chawla Soap Industries

(Arising out of OIA No.19/ST/PKL/2009 dt.8.4.2009 passed by Commissioner of Central Excise (Appeals) Delhi-I

CCE, Panchkula Appellants

Vs.

M/s.Chawla Soap Industries Respondent

Appearance:

Appellant: Shri V.P.Batra, AR

Present for the Respondent: None

Honble Mr.P.K.Das, Member (Judicial)

Honble Mr.P.S.Pruthi, Member (Technical)

1.

Whether Press Reporter may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?

No

2. Whether it would be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?

No

3. Whether their Lordships wish to see the fair copy of the order?

seen

4. Whether order is to be circulated to the Department Authorities?

Yes

Coram: Honble Mr. P.K.Das, Member (Judicial)

Honble Mr.P.S.Pruthi, Member(Technical)

Date of Hearing/decision: 22.01.2015

FINAL ORDER NO.50735/2015

PER: P.S.PRUTHI

This appeal is directed against the Order-in- Appeal in which the Commissioner (Appeals) set aside the penalties under section 76, 77 and 78 of the Finance Act, 1994.

3. The facts of the case are that on the basis of preventive checks conducted by the department, it was noticed that the respondent were not discharging service tax liability on transportation charges paid for transporting crude palm oil from Kandla port to their factory premises. The contention of the appellant is that the service tax on GTA service was introduced with effect from 1.1.2005 and the said scheme was new to them and they were not aware of the provisions of Service Tax Rules. The respondent deposited service tax when they became aware of the service tax liability. The adjudicating authority confirmed the demand of service tax of Rs.1,61,355/- alongwith interest which was appropriated as already paid. Penalty of Rs.1,61,355/- was imposed under section 76, 77 and 78 of the Finance Act, 1994. The penalty was set aside by the Commissioner (Appeals).

4. Heard both sides.

5. Learned AR relied on the decision of the High Court in the case of CC vs. Port Officer -2010 (257) ELT 37 (Guj.) holding that for waiver of penalty under section 80 of the Act, burden of proof is on the assessee to show reasonable cause for failure to pay service tax.

6. We find in this case that the Commissioner (Appeals) has given a clear finding that the service tax could not be deposited as it was a new levy and the assessee was not aware of the provisions of service tax, the period of dispute being 1.1.2005 to 24.2.2006. We find that in the earlier years of introduction of service tax, various services were made taxable from time to time in successive Budgets by the Government and that there could have been confusion in the minds of the assessees. The facts in the case do not reveal that there was definite intention to evade duty. It is a fact that transport charges were reflected in the records of the respondent. Therefore, it cannot be said that the respondent deliberately suppressed the facts. In the circumstances, we agree with the Commissioner (Appeals) in holding that there was reasonable cause for waiving penalty under section 76, 77 and 78 in terms of section 80 of the Act. We also note that Boards Instruction F.No.390/Misc/163/2010-JC dated 17.8.2011 prescribed the monetary limit of Rs.5 below which the appeal shall not be filed in the Tribunal. The same has been affirmed by the Honble Bombay High Court in the case of CCE vs. Techno Economic Services Pvt.Ltd.-2010 (20) STR 707 (Bom.).

7. In view of the above, appeal is rejected.

(Pronounced in the court)

(P.S.PRUTHI) (P.K.DAS)

MEMBER (TECHNICAL) MEMBER(JUDICIAL)

mk

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