M/S Nssl Ltd vs Commissioner Of Central Excise, Nashik

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

APPEAL NO. ST/89545/13

(Arising out of Order-in-Appeal No. NGP/EXCUS/000/APPL/843/13-14 dated 16.09.2013 passed by the Commissioner of Central Excise (Appeals), Nagpur.)

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 NSSL Ltd.

: Appellant Versus

Commissioner of Central Excise, Nashik : Respondent

Appearance Shri P.V. Sadavarte, Advocate : For Appellant Shri B. Kumar Iyer, Supdt. (A.R.) : For Respondent

CORAM: HONBLE SHRI ANIL CHOUDHARY, MEMBER (JUDICIAL)

Date of Hearing : 15.05.2015 Date of Decision: 15.05.2015

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

Per: Anil Choudhary:

The appellant is in appeal against confirmation of penalty under section 76, 77 & 78 of the Finance Act.

2. The brief facts are that the appellant is a manufacturer of parts of Motor Vehicle & Aluminium Castings falling under Chapter Heading 87 & 76 of CETA, 1985. During the course of scrutiny of records of the appellants, it was observed by the Revenue that the appellant has not paid the service tax for the period 2007-08 to 2009-10. It is admitted facts in the show-cause notice that, on being pointed out, the appellant has paid the entire dues along with interest on 02/02/2010. From the records, it further appears that they have also prayed for the benefit under Section 73(3) of the Finance Act. However show-cause notice dated 27/04/2012 was issued requiring to show-cause as to why the service tax amount Rs. 78,153/- being tax for the period 2007-08 to 2009-10 be not demanded and appropriated from the pre-deposit already made and further why not the amount of interest calculated at Rs. 10,698/- which was pre-deposited be not appropriated. Further penalty was proposed under Section 76, 77 & 78 of the Finance Act.

2.1 The appellant contested the show-cause notice stating that it is not a case of deliberate default and further prayed for benefit of Section 73(3) as they had admitted the tax liability and deposited the same with interest, at the first instance before issue of show-cause notice. However the show-cause was adjudicated and the proposed demand confirmed vide order in original and further penalty was imposed @ 200/- per day under Section 77 for failure to obtain service tax registration certificate in time and for failure to furnish prescribed returns. Also penalty of Rs. 39,077/- under Section 76 imposed. Further penalty of Rs. 78,153/- was imposed under Section 78 of the Finance Act. Being aggrieved, the appellant filed an appeal before learned Commissioner (Appeals). The ld. Commissioner (Appeals) vide the impugned order rejected the appellants appeal upholding Order-in-Original passed by Assistant Commissioner. Being aggrieved the appellant is in appeal before the Tribunal.

3. Heard the Parties.

4. Having considered the rival contention, I find that the appellant has deposited the entire dues alongwith interest on 02/02/2010, immediately on being pointed out by the Revenue. It is also appearing from the records that the appellant has intimated to the department about payment particulars vide their letter dated 14/05/2010 & the same was acknowledged by the department and also wrote a letter to the Commissioner, Central Excise Nagpur for waiver from penalties and not to issue any show-cause notice. I have perused the relevant provisions of Section 73(3). The same is reproduce as under:

(3)?Where any service tax has not been levied or paid or has been short-levied or short-paid or erroneously refunded, the person chargeable with the service tax, or the person to whom such tax refund has erroneously been made, may pay the amount of such service tax, chargeable or erroneously refunded, on the basis of his own ascertainment thereof, or on the basis of tax ascertained by a Central Excise Officer before service of notice on him under sub-section (1) in respect of such service tax, and inform the [Central Excise Officer] of such payment in writing, who, on receipt of such information shall not serve any notice under sub-section (1) in respect of the amount so paid

A plain reading of the above provisions makes it abundantly clear that if the assessee has discharged the service tax liability on his own ascertainment or on the basis of ascertainment by the Central Excise Officers and informs the Central Excise Officer of payment of such service tax then, no notice under sub-section (1) of Section 73 in respect of the amount so paid shall be served. In the instant case, the appellant discharged the tax liability for the period 2007-08 to 2009-10 along with interest on 02/02/2010. The above conduct of the appellant makes it abundantly clear that they have deposited the tax liability along with interest immediately on being pointed out by the Revenue. Therefore, the provisions of sub-section (3) of Section 73 is clearly attracted in the facts of the case and issuance of a show-cause notice for demand of service tax and imposition of penalties was not at all warranted.

4.1 Under the facts and circumstances, I hold that the appellant is entitled to the benefit under Section 73(3) of the Finance Act as the tax and interest had been paid under proper intimation. In this view of the matter the penalty imposed under Section 76, 77 & 78 are set-aside. The appellant will be entitled to refund of the penalties if any deposited by them within a period of 2 months from the date of receipt of a copy of this order.

5. Thus, the appeal is allowed with consequential benefits.

(Pronounced in open Court)

(Anil Choudhary)

Member (Judicial)

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