Commissioner Of Central Excise, ... vs M/S. Vishal Enterprises

[Arising out of Order-in-Appeal No. 12/2011 dated 28/01/2011 passed by the Commissioner of Central Excise (Appeals), Mangalore.]

For approval and signature:

HON'BLE SHRI B.S.V.MURTHY, TECHNICAL MEMBER

1 Whether Press Reporters may be allowed to see 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 of the Order?

4 Whether Order is to be circulated to the Departmental authorities?

Commissioner of Central Excise, Customs and Service Tax MYSORE S1-S2, VINAYA MARGA, SIDDHARTHA NAGAR, MYSORE  570 011. KARNATAKA Appellant(s)

Versus

M/s. VISHAL ENTERPRISES NO.17A, HUDCO LAYOUT, V CROSS, GANGOTRI LAYOUT, MYSORE Respondent(s)

Appearance:

Mr. Pakshi Rajan, Addl. Commissioner (AR) For the Appellant

None For the Respondent

Date of Hearing: 09/04/2015

Date of Decision: 09/04/2015

CORAM:

HON'BLE SHRI B.S.V.MURTHY, TECHNICAL MEMBER

Final Order No. 20946 / 2015

Per : B.S.V.MURTHY

Revenue is in appeal against the decision of the Commissioner (A) in the impugned order taking a view that the assessee need not pay penalty imposed on them by invoking the provisions of Section 80 of the Finance Act, 1994. For this purpose, reliance has been placed on the decision of the Supreme Court in the case of Dharmendra Textile Processors reported in 2008 (23) ELT 3 (S.C). Reliance is also being placed on the decision of the Tribunal in the case of CCE, Mumbai vs. Riya Travels and Tours (I) Pvt. Ltd.: 2009 (15) S.T.R. 124 (Tri.-Mum.); CCE, Ludhiana vs. Safal Constructions: 2009 (16) S.T.R. 453 (Tri.-Del.) to take a view that mandatory penalties imposed under Section 78 of the Finance Act, 1994 cannot be waived when suppression of facts stand established. It is the stand of the Revenue that by not taking registration and by not disclosing the facts of rendering of service to the Department, the assessee had indulged in suppression of facts and therefore suppression of facts has been established.

2. Nobody is present on behalf of the respondent.

3. On going through the Order-in-Appeal, I find that the Commissioner (A) has dealt with the issue in sufficient detail and in my opinion the conclusion reached by him is logical and is in accordance with law. Paragraph 9 of the impugned order is relevant and is reproduced below.

9. In the present case, in the impugned OIO, the adjudicating authority, in addition to confirming the demand under the Rent-a-Cab Scheme has also confirmed the demand of Rs.1,50,894/- under the category of Manpower Recruitment and Supply Agency Service. The appellant, in the grounds of appeal and as well as at the time of PH, has not disputed the levy of service tax under the category of Manpower Recruitment and Supply Agency Service and it is further reported that the appellant has already deposited the entire amount along with interest, which has also been re-appropriated in the OIO. As the entire service tax liability demanded under the category of Manpower Recruitment and Supply Agency Service has been discharged by the appellant before the issue of SCN, the appellant has requested for waiver of penalty under Section 80 of FA, 1994. I have examined the above request of the appellant. In respect of levy of service tax under the category of Rent-a-Cab Scheme, there were several decisions in the past which were in favour of the appellant, which had created confusion in the minds of the assessees regarding payment of service tax. In respect of service tax payable under the category of Manpower Recruitment and Supply Agency Service, as there was no confusion regarding the levy, the appellant has paid the entire amount along with interest which proves their bona fide intention. In view of the above, imposition of heavy penalty equivalent to duty amount under Section 78 of FA, 1994, is not justified. As there was a reasonable cause for their failure in not paying the service tax, the request of the appellant for the waiver of penalty imposed under Section 78 of the FA, 1994, taking recourse to the provisions to Section 80 of FA, 1994, merits consideration and accordingly I waive the penalty.

3. I agree that the findings of the Commissioner (A) that till the decision of the Honble High Court of Punjab and Haryana was rendered in the case of CCE, Chandigarh Vs. M/s. Kuldeep Sing Gill [2010-TIOL-436-HC-P-H-ST], there were views in favour of the assessee as regards Rent-a-Cab services and its liability for service tax. As regards Manpower Recruitment and Supply Agency Services, the moment it was pointed out, the appellants promptly paid the tax. Interest also has been paid. Under the circumstances, having regard to the amount involved and the nature of assessee and the volume of transactions, in my opinion, the invocation of provisions of Section 80 of Finance Act, 1994 by the learned Commissioner (A) is appropriate and does not call for any interference. In view of the above, I do not find any merit in the appeal filed by the Revenue and accordingly, reject the same.

(Order pronounced in open court)

B.S.V.MURTHY TECHNICAL MEMBER rv 3