M/S. Shivasakthi Fashions (P) Ltd vs Cce, Salem
- Case No.Appeal No. ST/40352/2014
Ratio decidendi
The rule this decision rests on
The penalty imposed under section 77 of the Finance Act, 1994 may be waived under section 80 of that Act where the assessee, though its tax liability was not paid in time, deposited the entire tax and interest before adjudication was completed, without any wilful evasion or attempt to flee the ambit of the law, so that there is reasonable cause for the failure within the meaning of section 80.
Written by Miss Lucy from the judgment below, not taken from a headnote.
Judgment
As delivered
(Arising out of Order-in-Appeal No. 50/2014-ST dated 6.2.2014 passed by the Commissioner of Central Excise (Appeals), Salem)
M/s. Shivasakthi Fashions (P) Ltd. Appellant
Vs.
CCE, Salem Respondent
Appearance
Shri M.N. Bharathi, Advocate, for the Appellant Shri B. Balamurugan, AC (AR) for the Respondent
CORAM
Honble Shri D.N. Panda, Judicial Member
Date of Hearing / Decision: 23.09.2015
Final Order No. 41258 / 2015
Learned counsel submits that the entire tax liability was deposited on 12.12.2012. Thereafter, interest thereon was deposited on 17.12.2012. The appellant also considering that it should not litigate with the Department, deposited penalty of Rs.19,479/- on 18.4.2013. This shows the conduct of the assessee who has not at all made any attempt to evade the tax due to the exchequer.
2. Added to the above, learned counsels submission is that when there is tax liability of Rs.77,930/- calling for penalty under section 77(i) and (ii) from appellant shall cause extreme hardship to it. Therefore, section 80 of the Finance Act, 1994 may be applied to remove such hardship.
3. Heard both sides and perused the records.
4.1 No doubt Revenue is correct that sometimes penalty is imposed as a preventive measure as well as curative dose to check the recurrence of breach of law. But the present case does not appear to be of that nature demonstrating willful evasion or making any attempt to flee away from the ambit of the law. 4.2 When the appellant came forward to comply to the law voluntarily, of course, after show cause notice was issued but before adjudication was completed on 19.9.2014, there is reasonable cause to invoke section 80 of the Act to waive penalty imposed both the sub-sections of sections 77 of the Finance Act, 1994. Appeal is accordingly allowed to the limited extent of waiver of penalty. (Dictated and pronounced in open court)
(D.N. Panda) Judicial Member Rex
2
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