Mrs Developers vs Commissioner Of Service Tax ...

[Arising out of Order-In-Appeal No.582-2013 dated 22/10/2013 passed by Commissioner of Central Excise and Service Tax , BANGALORE-II( Appeal) ]

For approval and signature:

HON'BLE Mrs. ARCHANA WADHWA, JUDICIAL MEMBER

1 Whether Press Reporters may be allowed to see 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 CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?

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

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

MRS Developers B-2, 1st Floor, Keb Layout, Btm Layout 1st Stage, Bannerghatta Main Road, BANGALORE - 560029 KARNATAKA Appellant(s)

Versus

Commissioner of Service Tax Bangalore-service Tax 1ST TO 5TH FLOOR, TTMC BUILDING,above BMTC BUS STAND,DOMLUR BANGALORE, - 560071 KARNATAKA Respondent(s)

Appearance:

Shri SATHYA VAGEESWARAN , ADVOCATE NO.918, 22ND MAIN ROAD, (BETWEEN 38TH & 39TH CROSS, 4TH T BLOCK, JAYANAGAR, BANGAORE BANGALORE -

KARNATAKA For the Appellant Shri Mohd. Yusuf, Addl. Commissioner(AR) For the Respondent

Date of Hearing: 02/01/2015

Date of Decision: 02/01/2015

CORAM:

HON'BLE Mrs. ARCHANA WADHWA, JUDICIAL MEMBER

Final Order No. 20019 / 2015

Per : ARCHANA WADHWA

As the appellant have deposited the entire service tax amount as also interest, I dispense with the condition of predeposit of penalty and proceed to decide the appeal itself inasmuch as a short issue is involved.

2. The appellants were acting as real estate agents for the developers, which activity is liable to service tax. However, during the period 2006-2008, they were neither collecting any service tax from their customers nor were paying the same. On being pointed out by the Revenue, the entire service tax of Rs.10,01,767/- was deposited by them along with interest of Rs.94,711/-. Subsequently they were served with the show-cause notice in July 2009 proposing imposition of penalty upon them, which proceedings culminated into the impugned order passed by the authorities below.

3. The appellants contention is that they were not aware of their liability to pay the service tax. However, on being pointed out by the Revenue, they immediately deposited the amount along with interest, even though they had stopped their business and the service tax was not collected by them. In such a scenario, the contention of the learned advocate is that the provisions of Section 73(3) of the Finance Act would get attracted. In terms of the said provisions, if an assessee deposits the service tax on the basis of tax ascertained by a Central Excise Officer before service of the notice on him, no such notice shall be served to him. As such he submits that inasmuch as he deposited the tax before the issuance of the show-cause notice, there was no requirement of issuance of notice to him.

4. On the other hand, the contention of the learned AR is that sub-section 4 of Section 73 debars application of sub-section 3 in case such short levy was on account of fraud, collusion, wilfull misstatement or suppression of facts etc. As such he submits that even if the service tax was deposited before the issuance of the show-cause notice, the penal provisions would still get attracted.

5. Having appreciated the submissions made by both the sides, I find that there is no dispute about the fact of deposit of service tax along with interest before the issuance of the show-cause notice. The lower authorities have not referred to any evidence or fact of mis-statement or suppression on the part of the assessee. In such a scenario, the provisions of Section 80 would get attracted and the requirement of issuance of show-cause notice for imposition of penalty is to be done away with in terms of sub-section 3 of Section 73. On this ground, I set aside the impugned order so far as the same relates to imposition of penalty upon the assessee. Stay petition as also appeal get disposed of in above manner.

(Order pronounced and dictated in open court)

ARCHANA WADHWA JUDICIAL MEMBER

Raja.