Dr. B.B. Tanpure Ssk Ltd vs Cce Aurangabad

IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL, WEST ZONAL BENCH AT MUMBAI COURT NO. II

APPEAL NO. ST/318/10  Mum

Arising out of Order-in-Appeal No. AGS(46)134/2010 dated 18.03.2010 passed by the Commissioner of Central Excise & Customs (Appeals), Aurangabad.

For approval and signature:

Shri. M.V. Ravindran, Member (Judicial) Shri. P.R. Chandrasekharan, Member (Technical)

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 : No 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?

Dr. B.B. Tanpure SSk Ltd. : Appellant

Versus

CCE Aurangabad

Respondent

Appearance

None for appellant Shri S.V. Nair, Supdt. (A.R.) For Respondent

CORAM:

Shri. M.V. Ravindran, Member (Judicial) Shri. P.R. Chandrasekharan, Member (Technical)

Date of Hearing : 11.03.2015 Date of Decision : 11.03.2015

ORDER NO.

Per : M.V. Ravindran This appeal is directed against Order-in-Appeal No. AGS(46)134/2010 dated 18.03.2010.

2. When this matter was called out none appeared on behalf of the appellant. With the assistance of the learned departmental representative, we perused the records and find that the appeal could be disposed of even in the absence of any representation from the appellant. Accordingly, we take up the appeal for disposal.

3. The issue involved in this case is regarding discharge of service tax liability on the sugarcane transportation charges during the period 2006-07, 2007-08 and 2008-09 (upto August 2008). The appellant had not paid the service tax and had improperly discharged the tax liability by not taking into consideration the entire taxable value was the allegation. Show-cause notice was issued proposing to demand the differential service tax leviable on sugarcane transportation charges and inward freight charges. It was also proposed to appropriate the service tax already paid by the appellant on the sugarcane transportation charges, the show-cause notice also demanded interest on the amount of service tax liability which was short paid and also for imposition of penalty on the appellant. Appellant contested the show-cause notice before the adjudicating authority. Adjudicating authority did not agree with the contentions raised by the appellant and confirmed the demands along with interest and also imposed penalty. Aggrieved by such an order, the appellant preferred an appeal before the first appellate authority. First appellate authority also did not agree with the contentions raised by the appellant and rejected the appeal. Hence this appeal.

4. On perusal of the records of appeal, we find that the appellant is contesting only on the imposition of penalty under Section 78 of the Finance Act, 1994. It is seen from the Grounds of Appeal that the pleading is penalty should be set aside as they have paid the entire amount before the issuance of show-cause notice.

5. Learned D.R. on the other hand would submit that the entire amount has not paid before the issue of show-cause notice and the appellant had not contested the issue before the first appellate authority vehemently. Hence the penalty imposed under Section 78 is correct and no interference is called for.

6. On consideration of the submissions made by the learned D.R and perusal of the records, we do find that the appellant is not contesting the issue on merits and has also paid differential amount of service tax liability along with the interest. We find that the first appellate authority in para 6 of the impugned order has specifically recorded that the appellant has deposited the service tax liability along with interest and also recorded that the appellant had submitted the copies of TR-6/GR-7 challans evidencing the payments. We find that the issue involved in this case is regarding the service tax liability on the transportation of incoming material and more specifically sugarcane. In our considered view, during the material period i.e. upto August 2008, the issue was being agitated and the appellant had also taken a plea that due to financial crisis they were not able to pay the balance amount on transportation of sugarcane and inward transportation of stores material. We find that in this case, non-discharge of service tax liability is not due to ulterior motive but due to financial difficulties that was faced by the appellant. In our view it is a fit case for us to invoke the provisions of Section 80 of the Finance Act, 1994 and we do so. By invoking the provisions of Section 80 we set aside the penalty imposed by the adjudicating authority and upheld by the first appellate authority while upholding the confirmation of demand of service tax liability and the interest thereof.

7. The appeal is disposed of as indicating here-in-above.

(Dictated in open Court)

(P.R. Chandrasekharan) Member (Technical)

(M.V. Ravindran) Member (Judicial) nsk ??

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