M/S. U.B. Engineering Ltd vs Commissioner Of Central Excise, Pune ...

(Arising out Order-in-Appeal No. PIII/VM/254/09 dated 22.11.2009 passed by the Commissioner of Central Excise (Appeals), Pune III)

For approval and signature: Honble Mr. M.V. Ravindran, Member (Judicial) Honble Mr P.R. Chandrasekharan, Member (Technical)

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 No CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?

3. Whether Their Lordships wish to see the fair copy Yes of the Order?

4. Whether Order is to be circulated to the Departmental Yes authorities?

M/s. U.B. Engineering Ltd. Appellant

Vs.

Commissioner of Central Excise, Pune III Respondent

Appearance:

None for the appellant Shri B.S. Meena, Addl.Comm. (AR) for the respondent

CORAM:

Honble Mr. M.V. Ravindran, Member (Judicial) Honble Mr. P.R. Chandrasekharan, Member (Technical)

Date of hearing : 30/01/2015 Date of decision : 30/01/2015

O R D E R No:..

Per: M.V. Ravindran:

This appeal is directed against Order-in-Appeal No. PIII/VM/254/09 dated 22.11.2009.

2. When the matter was called out, none appeared on behalf of the appellant. On perusal of the record and after hearing the Departmental Representative, we find that the matter can be disposed of in the absence of any representation from the appellant. Accordingly, we take up the appeal for disposal.

3. On perusal of the record, it transpires that the appeal is directed against the imposition of penalty under Section 78 of the Finance Act, 1994. Appellant is not contesting the taxability of the services rendered by them. It is also noted that the appellant has discharged the entire tax liability with interest on or about 01.12.2006. We note that the appellant was issued a show-cause notice on 27.02.2007. The Adjudicating Authority in his order has confirmed the service tax liability, interest thereon and appropriated the amounts paid by the appellant. The Adjudicating Authority has by invoking the provisions of Section 80 did not impose penalties under Section 76 and 77 of the Finance Act, 1994 on the appellant, but imposed penalty under Section 78. The first appellate authority has retained the said penalty.

4. We find that the reason which has been pleaded by the appellant before the first appellate authority as well as before us for short levy or non-levy of service tax is on account of liquidity crisis which got worse because of various Court petitions filed by their lenders and creditors. This particular plea has not been contraverted by the revenue in the Order-in-Original or the impugned order. In our considered view, the reason the appellant has given is justifiable reason for setting aside the penalty imposed on them; which the Adjudicating Authority has rightly done so by not imposing penalties under Section 76 & 77 of the Finance Act, 1994. We invoke the provisions of Section 80 of the Finance Act, 1994 and set aside the penalty imposed under Section 78 of the Finance Act, 1994 as upheld by the impugned order.

5. The appeal is allowed.

(Operative part pronounced in Court)

(P.R. Chandrasekharan) (M.V. Ravindran) Member (Technical) Member (Judicial)

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