M/S. Lister Technologies Pvt. Ltd vs Commissioner Of Service Tax, Chennai
- Case No.Appeal No. ST/41849/2013
Ratio decidendi
The rule this decision rests on
Where the law on liability was genuinely unclear before a Supreme Court decision settled it, a penalty under section 76 of the Finance Act, 1994 cannot be imposed for the period before that decision on the ground of non-payment of tax that was not then clearly leviable; and penalty under section 76 cannot be sustained for the period after the assessee began voluntarily paying tax, since the assessee had then come into compliance with the law. Where the adjudicating authority has not computed the portion of penalty attributable to a period, the penalty cannot be sustained without that computation, and the absence of tax liability for a period means no penalty can be imposed for that period. A penalty under section 77 of the Finance Act, 1994 for a procedural default, where the appellant offers no rebuttal of the finding, stands confirmed.
Written by Miss Lucy from the judgment below, not taken from a headnote.
Judgment
As delivered
(Arising out of Order-in-Appeal No.188/2013 (MST) dated 26.4.2013 passed by the Commissioner of Central Excise (Appeals), Chennai)
M/s. Lister Technologies Pvt. Ltd. Appellant
Vs.
Commissioner of Service Tax, Chennai Respondent
Appearance
Shri Vijay Anand, Chartered Accountant, for the Appellant Shri M. Rammohan Rao, JC (AR) for the Respondent
CORAM
Honble Shri D.N. Panda, Judicial Member
Date of Hearing / Decision: 14.09.2015
Final Order No. 41208 / 2015
Appellants submission is that as soon as the position of law was made clear to the appellant it had voluntarily paid the service tax with effect from 18.4.2006 and for the period prior to that there shall be no liability. Therefore, in view of confusion of the law, there must not be penalty under section 76 of the Finance Act, 1994.
2. Revenue supports levy of penalty under section 76 and also under section 77 of the Finance Act, 1994.
3. So far as penalty under section 77 is concerned, there is no basis for the appellant to rebut the order of the Commissioner (Appeals) on that count. Therefore that penalty is confirmed which is Rs.5,000/-.
4. So far as penalty under section 76 of the Finance Act 1994 is concerned, there is no computation made by learned Commissioner (Appeals) to work out what shall be the penalty attributable prior to 18.4.2006. So far as subsequent date is concerned, it appears that the appellant had come forward to comply to the law which is also patent from the recovery of Rs.4,95,950/- in the course of investigation. Therefore, there shall be no penalty at all post 18.4.2006 since the law was in confusing state before the decision of the apex Court in the case of Union of India vs. Indian National Shipowners Association 2010 (17) STR J57 (SC).
5. Learned Commissioner (Appeals) in para 8 of his order has rightly appreciated the law that the appellant has no liability before 18.4.2006. Therefore, when there was no tax liability there shall be no penalty. Accordingly, appeal is allowed. (Dictated and pronounced in open court)
(D.N. Panda) Judicial Member Rex
2
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