M/S Bhagya Inductions vs Commissioner Of Central Excise And ...

ST/501/2011-SM [Arising out of Order-in-Appeal No 213/2010 dated 24/09/2010 passed by Commissioner of Central Excise (Appeals), Mangalore]

For approval and signature:

HON'BLE Mrs. ARCHANA WADHWA, JUDICIAL 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?

M/s BHAGYA INDUCTIONS 269/M, HEBBAL IND AREA, (BEHIND RPG) MYSORE- 570018 Appellant(s)

Versus Commissioner of Central Excise and Service Tax, MANGALORE 7TH FLOOR, TRADE CENTRE, BUNTS HOSTEL RD., MANGALORE  575003. Respondent(s)

Appearance :

None For the Appellant Mr. A.K. Nigam, A.R. For the Respondent

Date of Hearing: 12/01/2015 Date of Decision: 12/01/2015 CORAM :

HON'BLE Mrs. ARCHANA WADHWA, JUDICIAL MEMBER

Final Order No. 20076 / 2015

Per ARCHANA WADHWA

On matter being called today, nobody appeared. I heard learned A.R. on behalf of Revenue and gone through the impugned order.

2. Issue involved in the present appeal is the appellants liability to service tax under GTA Services so received by them. The appellants claim is that in most of the freight/transportation, the freight charges incurred was less than Rs. 750/- which do not call for payment of any service tax. They also referred to the provisions of Notification No. 34/2004-S.T. dated 03.12.2004 as also to the fact that the goods were also sent by them through Auto, Car, Taxi, etc. which do not attract payment of service tax under GTA Services.

3. It is seen that Assistant Commissioner took into consideration the entire pleas of the appellant and, after verifying the statements furnished by the assessee, observed that in terms of Notification No. 34/2004-ST dated 03.12.2004 and after abatement of 75% on the value, the total service tax comes to around Rs. 21,046/- (Rupees Twenty one thousand forty six only) which the appellant had deposited before issue of show-cause notice. As such, he held that there is no warrant for payment of late fee of Rs. 10,000/- (Rupees Ten thousand only) in terms of Rule 7C of Service Tax Rules, 2002 inasmuch as the provisions of the said rule exempts penalty in case of sufficient reason for not filing the returns. He also observed that during the part period 01.01.2005 to 31.3.2007, when the appellant had not filed any return, there was no warrant for levy of penalty or for late fee, as the said rule permits that the returns were not required to be filed, if the assessment is Nil. For the above proposition, he relied upon the Tribunals decision in the case of B & A Multiwal Packaging Ltd. Vs. CCE, BBSR [2006 (003) STR 673 (Tri.-Kol.)].

4. The said order of the Assistant Commissioner was impugned by Revenue before the Commissioner (Appeals) and the appellate authority remanded the matter by observing that non-payment of service tax during the period 1.4.2007 to 30.9.2008 was intentional, inasmuch as, the appellant has taken the service tax Registration only on 5.1.2009 and as such, the appellant is liable to penalty under Section 78 of the Finance Act, 1994. Accordingly, he remanded the matter to the Assistant Commissioner for re-quantifying the exact service tax liability along with interest and imposition of penalty. The said order of the Commissioner (Appeals) is impugned before the Tribunal.

5. On going through the said orders of the authorities below, I find that the Assistant Commissioner has examined the entire facts and details and has also held that service tax demanded in the show-cause notice was deposited by the assessee, after availing the abatement of 75% in terms of Notification No. 34/2004-S.T dated 3.12.2004. As against the said order, the observations made by the appellate authority are cryptic and not arising out of the impugned order of the Assistant Commissioner. The Commissioner (Appeals) has not referred to any of the issues on merits and has simpliciter observed that the order of the Assistant Commissioner is not correct. As regards the penalty, I find merits in the findings of the original adjudicating authority that inasmuch as the most of the cases, the freight charges involved is less than Rs. 750/- (Rupees Seven hundred fifty only) and the goods were being transported through taxi, car, auto etc. and in most of the cases, transporters were themselves paying service tax, non-payment of service tax to a small amount cannot be held attributable to any malafide on the part of the appellant so as to invoke the penalty provisions.

6. In view of above, I find no merits in the order of the Commissioner (Appeals). The same is set aside and the order of the original adjudicating authority is restored. Appeal is allowed in above terms.

(Pronounced and dictated in open court)

(ARCHANA WADHWA) JUDICIAL MEMBER /vc/