M/S Carraro India Pvt. Ltd vs Commissioner Of Central Excise, ...

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

APPEAL NO. ST/85672/13

(Arising out of Order-in-Appeal No. P-III/RP/262/12 dated 27.11.2012 passed by the Commissioner of Central Excise (Appeals), Pune-III.)

For approval and signature: Honble Shri Anil Choudhary, 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 : Yes 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? =====================================================

M/s Carraro India Pvt. Ltd.

: Appellant Versus

Commissioner of Central Excise, Pune-III : Respondent

Appearance Shri S.S. Rangnekar, C.A. : For Appellant Shri Ashok B. Kulgod, Asst. Commr. (A.R.) : For Respondent

CORAM: HONBLE SHRI ANIL CHOUDHARY, MEMBER (JUDICIAL)

Date of Hearing : 13.05.2015 Date of Decision: 13.05.2015

ORDER NO.......................................................

Per: Anil Choudhary:

The appellant company, a manufacturer, is aggrieved by Order-in-Original imposing penalty under Section 78 and also holding that the extended period of limitation is applicable under the facts and circumstances. The appellant appealed before the Commissioner (Appeals) who vide the impugned order, rejected the appeal.

2. The brief facts are that vide show-cause notice dated 09.02.2010, it is observed that appellant is registered under various heads/classification, for payment of Service Tax, for which compliances have been made. During course of Audit by CERA, it was noticed that appellant have paid commission for services availed from sales commission agents, located out side India, but have not paid Service Tax on reverse charge basis for the transactions during the period July, 2007 to February, 2009, resulting into tax not paid or short paid for Rs. 2,95,068/-.

2.1 The appellant on understanding the audit objection is correct, paid the tax with interest under information to the authority. Show-cause notice was issued proposing to adjust the amount so paid with interest and further alleging concealment, penalty was proposed under Section 70, 76 & 78.

2.2 The appellant contested the show-cause notice taking the ground that due to lack of understanding & knowledge, the tax could not be paid on reverse charge basis, as normally the tax is payable by provider of service. Vide Order-in-Original the tax liability already paid, was adjudicated and appropriated with interest. Further penalty was imposed under Section 70 & 78 of the Finance Act, holding concealment of facts on the part of appellant, with intent to evade tax.

2.3 Being aggrieved, the appellant preferred appeal before Commissioner (Appeals), in vain. Hence is now before this Tribunal.

3. The learned Consultant contends that the learned Commissioner have erred in confirming the penalty under Section 78 for the reasons that (i) it is an admitted fact that the transaction was found by audit team duly recorded in the books of Account and (ii) the appellant had paid the tax with interest, before issue of show-cause notice, and thus entitled to benefit under Section 73(3). Further, in view of the transaction recorded in books of Account, the allegation of suppression and/or contumacious conduct, does not stand, which is the condition precedent for imposing of penalty under Section 78.

4. The learned A.R. relies on the impugned order.

5. Having considered the rival contentions, I hold that there is no case of suppression of facts and/or contumacious conduct made out against the appellant. I further hold that the appellant is entitled to the benefit under Section 73(3) of the Act.

6. The appeal is allowed and the impugned order is set aside. The appellant will be entitled to consequential benefit, if any.

(Pronounced in open Court)

(Anil Choudhary)

Member (Judicial) Sp 3