Galaxy Constructions Pvt. Ltd vs Commissioner Of Central Excise, Nagpur

(Arising out of Order-in-Appeal No. SR/364/NGP/2010 dated 14-10-2010 passed by Commissioner of Central Excise (Appeals), Nagpur.)

For approval and signature:

Honble Mr. M.V. Ravindran, Member (Judicial) and Honble Mr. C.J. Mathew, Member (Technical)

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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 : 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?

====================================================== Galaxy Constructions Pvt. Ltd. Appellant Vs. Commissioner of Central Excise, Nagpur Respondent

Appearance: Shri L.Badrinarayan, Advocate for Appellant Shri S.R. Nair, E.O. (AR), for Respondent

CORAM: Honble Mr. M.V. Ravindran, Member (Judicial) Honble Mr. C.J. Mathew, Member (Technical)

Date of Hearing : 26/08/2015 Date of Decision : 26/08/2015

ORDER NO

Per: M.V. Ravindran

This appeal is directed against Order-in-Appeal No. SR/364/NGP/2010 dated 14-10-2010.

2. Heard both sides and perused the records.

3. The issue involved in this case is whether the appellant herein is liable to discharge the service tax liability under the category of Commercial or Industrial Construction Services for the period of 10-09-2004 to 29-09-2007. The appellant herein had discharged the entire service tax liability and the interest thereof, before the issuance of show cause notice. Learned Counsel would try to argue the matter on merits before us. It is also his submission that appellant has paid the entire amount with interest, hence penalties to set aside by invoking provisions of Section 80.

4. We find the arguments raised by the learned counsel on merits are not acceptable in as much that the appellant had not contested the issue on merits before the first appellate authority, in view of this, we uphold the confirmation of service tax liability and the interest thereof. We do find from records that the appellant had discharged the entire service tax liability before the issuance of show cause notice and has also discharged the interest thereof. We find that the having discharged the entire service tax liability and the interest thereof, the issue that arises for consideration as to whether penalties need to be imposed on appellant. In our considered view in the facts and of circumstances of this case, we find that the provisions of section 73(3) of the Finance Act 1994, would be applicable which mandates for non issuance of show cause notice by the authorities if tax and interest is paid of. In our considered view the show cause notice issued for imposition of penalties is not correct. Be that as it may, similar issue was decided by the Tribunal in the case of Manipal County Vs. Commissioner, Banglore-2010(17)STR 474 held that if demand of tax having being made good before the issuance of show cause notice, penalties need not to imposed. The said decision of the Tribunal was taken in appeal by the Revenue before the Honble High Court of Karnataka and the same was dismissed on 09-09-2011as reported at 2014 (36) STR J 189(Kar.).

5. Respectfully following the same, we hold that the penalties imposed by the adjudicating authority and upheld by the first appellate authority are unwarranted and are set aside, the appeal is disposed of by upholding service tax liability and interest, and penalties are set aside.

(Pronounced in Court)

(C.J. Mathew) Member (Technical) (M.V. Ravindran) Member (Judicial)

akp 1 3 APPEAL No.ST/21/11-Mum