M/S. Shree Mobiles vs Commissioner Of Central Excise, ...

Customs Excise and Service Tax Appellate Tribunal14 July 2015

CitationAppeal No.42/2007 (M-III)(ST), dated 27.04.2007 passed by the Commissioner of Central E

Ratio decidendi

The rule this decision rests on

Where a small assessee, ignorant of the law, failed to pay service tax on the portion of gross value deducted at source under the Income Tax Act, and has since discharged the tax and shown no deliberate intention to evade, the Tribunal may find reasonable cause under Section 80 of the Finance Act, 1994 and set aside the penalty under Section 76. Penalties imposed under Section 75A and Section 77 are not excused by the reasonable-cause provision of Section 80 on the facts found, and are sustained.

Written by Miss Lucy from the judgment below, not taken from a headnote.

Judgment

As delivered

IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNALSOUTH ZONAL BENCH, CHENNAIST/00184/2007

[Arising out of Order-in-Appeal No.42/2007 (M-III)(ST), dated 27.04.2007 passed by the Commissioner of Central Excise (Appeals), Chennai]

M/s. SHREE MOBILES APPELLANT

Versus

COMMISSIONER OF CENTRAL EXCISE, CHENNAI-III RESPONDENT

Appearance:

For the Appellant Shri Bharat Kumar, for M/s. Sanjiv Shah & Associates [No vakalat on file] Cons.

For the Respondent Shri B. Balamurugan, AC (AR)

CORAM:

Honble Shri D.N. Panda, Judicial Member

Date of hearing/decision 14-07-2015

FINAL ORDER NO.40900 / 2015

Learned consultant submits that the appellant is a small tax payer and also being ignorant of law, could not pay service tax on that part of the gross value which was TDS since he was under impression that amount received was only liable to service tax. Such fact only has brought the appellant to the scope of service tax raising a demand of Rs.60,230/- on the TDS made under Income tax law. Appellant has discharged tax amount of Rs.48,803/- leaving balance of Rs.11,427/-. That balance amount has also been deposited on 10.06.2013 and there is no further amount recoverable.

2. On the aforesaid premise, it is prayed that the penalty of Rs.60,230/- imposed under Section 76 may be waived and penalty of Rs.1,000/ imposed under Section 75A also waived. Similarly, penalty imposed under Section 77 should also be waived since the assessee was not aware of the provision of law being a small tax payer.

3. Revenue on the other hand supports adjudication.

4. Heard both sides and perused the records.

5. Considering that the appellant has discharged tax liability to the extent of Rs.48,803/- and its defiant attitude does not come out for no deliberate intention to cause evasion to Revenue apparent from record. Finding reasonable cause to invoke Section 80 of the Finance Act, 1994, there shall be no penalty under Section 76. But penalties imposed under Section 75A and 77 are confirmed.

6. Appeal is allowed to the extent indicated above. (Dictated and pronounced in open court)

(D.N. PANDA) JUDICIAL MEMBER

ksr 24-07-2015

DRAFT Remarks

I II III

Date of dictation 14.07.2015

Draft Order - Date of typing 21.07.2015

Fair Order Typing 24.07.2015

Date of number and date of dispatch 27.07.2015

3 ST/00184/2007

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