Commissioner Of Central Excise & ... vs M/S. Arihant Telecommunications
- CitationAPPEAL NO. ST/89730/13
Ratio decidendi
The rule this decision rests on
Where a demand spans a period during which the unamended Section 78 was in force, a penalty under Section 76 and a penalty under Section 78 may be imposed simultaneously, so the Commissioner (Appeals) was wrong to drop the Section 76 penalty on the footing that the amended Section 78 applied. The power to waive penalties under Section 76, 77 and 78 under Section 80 of the Finance Act, 1994 must be examined on the facts; an absence of mala fide intention to evade service tax is a relevant consideration in that examination, and the Section 76 penalty must be re-examined under Section 80 rather than dropped on the ground of the amendment.
Written by Miss Lucy from the judgment below, not taken from a headnote.
Judgment
As delivered
[Arising out of Order-in- Appeal No. NS/-EXCUS-000-APP-261-13-14 dtd. 11/9/2013 passed by the Commissioner(Appeals) Central Excise & Customs, Nashik]
For approval and signature:
Honble Mr Ramesh Nair, Member(Judicial)
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1. Whether Press Reporters may be allowed to see : No the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?
2. Whether it should be released under Rule 27 of the : CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
3. Whether Their Lordships wish to see the fair copy : seen of the Order?
4. Whether Order is to be circulated to the Departmental: Yes authorities? =======================================================
Commissioner of Central Excise & Customs, Nashik : Appellants
VS
M/s. Arihant Telecommunications : Respondent
Appearance
Shri. S.V. Nair, Asstt. Commissioner(A.R.) for the Appellants Shri. for the Respondent
CORAM:
Honble Mr. Ramesh Nair, Member (Judicial)
Date of hearing: 10/6/2015 Date of decision: 10/6/2015
ORDER NO.
Per : Ramesh Nair
This Revenues appeal is directed against Order-in- Appeal No. NS/-EXCUS-000-APP-261-13-14 dtd. 11/9/2013 passed by the Commissioner (Appeals) Central Excise & Customs, Nashik wherein Ld. Commissioner (Appeals) upheld the confirmation of demand, interest, penalty under Section 78. However penalty imposed under Section 76 was dropped; accordingly order in original was modified.
2. The fact of the case is that the respondent is engaged in providing Franchisee service of selling SIM cards of Bharat Sanchar Nigam Ltd (hereinafter called as BSNL) on commission basis for which they entered into agreement with BSNL. During the period April 2005 to December 2008 the respondent received the commission from BSNL. The department viewed that the activity of the respondent fell under the category of Business Auxiliary Services as per Section 65(19) of the Finance Act. In the denovo adjudication the service tax demand of Rs. 10,57,298/- was confirmed and penalty under Section 76, 78 imposed and interest under Section 75 also demanded. Aggrieved by the original order respondent filed appeal before the Commissioner (Appeals) who except dropping penalty imposed under Section 76 upheld the confirmation of demand, Penalty under Section 78 and interest under Section 75. The Commissioner (Appeals) dropped the penalty of Section 76 on the ground that at the time of issuance of show cause notice, Section 78 was amended and according to the amendment if the penalty imposed under section 78, penalty under Section 76 should not be imposed.
3. Shri. S.V. Nair, Ld. Asstt. Commissioner (A.R.) submits that Ld. Commissioner (Appeals) has erred in dropping the penalty for the reason that non payment of service tax as taken place during the April 2005 to December, 2008 and at the relevant time unamended Section 78 was enforce and according to which penalty under Section 76 and 78 was imposable simultaneously therefore there is infirmity in the impugned order.
4. None appeared on behalf of the respondent.
5. I have carefully considered the submission made by Ld. A.R.
6. On perusal of the record, I find that period of demand is April 2005- December, 2008 during the said period penalty under Section 76 and 78 simultaneously imposable therefore I do not agree with the Ld. Commissioner(Appeals) inasmuch as he dropped the penalty imposed under Section 76 on the ground that amended provision of Section 78 is applicable in the present case however looking into fact and circumstances of the case, it can be seen that respondent has no malafide intention to evade service tax. Ld Commissioner (Appeals) has not examined the present case in view of Section 80 under which provision for waiver for penalty under Section 76, 77, and 78 has been provided. Therefore I remand the matter to the Ld. Commissioner (Appeals) to examine the penalty under Section 76 in view of Section 80 of the Finance Act, 1994 and pass a fresh order only on the limited issue of imposition of penalty under Section 76. The appeal is allowed by way of remand.
(Dictated in court)
Ramesh Nair Member (Judicial)
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4
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