M/S. Isum Motors Pvt. Ltd vs Commr. Of Central Excise & Service ...

(Arising out of the Order-in-Appeal No. 49/GHY/CE(A)/GHY/2013 dated-2/09/2013 passed by the Commissioner, Customs & Central Excise (Appeals), Guwahati) For approval and signature of: DR.D.M. MISRA, HONBLE JUDICIAL MEMBER

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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. Isum Motors Pvt. Ltd.

APPELLANT(S) VERSUS Commr. of Central Excise & Service Tax,Guwahati RESPONDENT(S) APPEARANCE

Sri Arijit Chakraborty, Advocate

FOR APPELLANT(S) Sri A. Roy, Supdt. (A.R) FOR THE RESPONDENT(S) CORAM: DR.D.M. MISRA, HONBLE JUDICIAL MEMBER

DATE OF HEARING & DECISION : 04/09/2015

ORDER NO : FO/a/75494/15

This is an appeal filed against Order-in-Appeal No. 49/GHY/CE(A)/GHY/2013 dated-2/09/2013.

2. Briefly stated the facts of the case are that the appellant was issued with a demand notice on 17/02/2010 alleging short payment/non-payment of service tax during the period 2005-2006 to 2009-2010 for providing taxable services under the category of authorized service station services and business auxiliary services. On adjudication, the entire demand of Rs.13.07 Lakhs was confirmed and equal amount of penalty imposed under Section 78 and penalty under Section 76 of the Finance Act, 1994.

3. Aggrieved by the said order, the appellant preferred an appeal before the Ld. Commissioner (Appeal). The Ld. Commissioner (Appeals) after recording reasons, modified the Order of the adjudicating authority by reducing the demand to the admitted liability of Rs.5,49,538/- and confirmed the penalty under Section 76 of the Finance Act, 1994. Aggrieved by the imposition of penalty, under Section 76, the appellant are in Appeal before this forum.

4. Ld. Advocate Shri Arijit Chakraborty for the appellant submits that short payment/non-payment of service tax arose during the course of audit of their records. On being pointed out, about the said short payment, the appellant after their own ascertainment, discharged the tax liability of Rs.5,86,260/-, before issuance of the show cause notice. It is the plea of the Ld. Advocate that since there was no suppression of facts and mis-declaration in discharging the service tax liability, therefore, show cause notice should not have been issued as the amount had already been paid before the issuance of the show cause notice in view of specific provisions prescribed under Section 73(3) of Finance Act, 1994. In support of his contention, he has referred to the judgment of this Tribunal in the case of Electro World Vs. Commissioner of Central Excise, Chandigarh reported in 2010 (20) S.T.R. 210 (Tri.-Del.), Auto Transport Services Vs. Commissioner of Central Excise, Jaipur-II reported in 2006 (3) S.T.R. 330 (Tri.-Del.) and Gopsons Papers Ltd. Vs. Commr. of Central Excise, Noida reported in 2007 (7) S.T.R. 145 (Tri.-Del.) . It is his contention that the penalty thus confirmed under Sec. 76 of the Finance Act,1994 is accordingly, bad in law.

5. Ld. A.R. for the Revenue submits that Section 76 and Section 78 are mutually exclusive and confirmation of penalty under Section 76 by the Ld. Commissioner (Appeals) cannot be faulted. He submits that the plea of the appellant that no show cause notice is required to be issued under Section 73(3) of Finance Act, 1994 has not been taken before the Ld. Commissioner (Appeals). Accordingly, the Ld. Commissioner (Appeals) could not record any findings on such submission and its applicability to the facts of the present case.

6. In his rejoinder the Ld. Advocate for the appellant fairly agrees that the plea of applicability 73 (3) of the Finance Act,1994 was not taken up by the Appellant before the Ld. Commissioner (Appeals) and he has no objection in remanding the case to the Ld. Commissioner for deciding afresh the said issue.

7. Heard both sides and perused the records. I find that the Ld. Commissioner has dropped the penalty under Section 78 of the Finance Act while reducing the confirmed demand. I find that while confirming the penalty under Section 76 of Finance Act, 1994, the Ld. Commissioner (Appeals) has observed that since the appellant had agreed to the short payment of service tax, therefore, the penalty under Section 76 of Finance Act, 1994 is justified. The Ld. Advocate assailing the impugned Order contended that since the appellant had discharged their liability before issuance of show cause notice, therefore, in view of the specific provisions contained under Section 73(3) of the Finance Act, 1994, no show cause notice for the said liability should have been issued to them. It is conceded by the Appellant that this plea has not been raised before the Ld. Commissioner (Appeals) and advanced for the first time before this Tribunal. In the interest of justice, I am of the view that the appellant be given a fair chance to raise the said plea before the Ld. Commissioner (Appeals) and the Ld. Commissioner should accordingly consider the same and decide the issue of imposition of penalty under Sec.76 of Finance Act,1994, accordingly. To this extent the impugned Order is modified. Needless to mention that reasonable opportunity of hearing be given to the appellant. Appeal disposed of as above.

(Dictated and pronounced in the open court)

Sd/- 18/09/15 (D.M. MISRA) JUDICIAL MEMBER

K.b/-

Service Tax Appeal No. ST/71430/2013

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