9911796707
TMI Blog2018 (9) TMI 1147X X X X Extracts X X X X X X X X Extracts X X X X ..... effect. Demand set aside - appeal allowed. - ST/85750/18 - A/87298/2018 - Dated:- 17-9-2018 - Dr. Suvendu Kumar Pati, Member (Judicial) For the Appellant : Ms. Lalita Phadke, Advocate For the Respondent : Shri Suresh, (AR) ORDER Confirmation of penalty and invocation of extended period after discharge of duty liability along with interest by the Commissioner (Appeals), CE GST, Nagpur in his order No. NGP/EXCUS/000/APPL/540/17-18 dated 28.11.2017 is being challenged in this appeal. 2. Facts giving rise to the present appeal can be summed up as violation of provision contained under Section 66A of the Finance Act, 1994 by the appellant in not paying service tax of `12,78,540/- against payment made to overseas commission agent to the tune of `1,31,89,860/- for services falling under category of Business Auxiliary Service. Under the reverse charge mechanism, appellant company is deemed to be regarded as service provider, though a service recipient in the ordinary course of business. On the basis of intelligence gathered by the officer of preventive branch, Head office, Nagpur enquiry was conducted, documents of appellant were verified, tax demand was made ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ved under sub-section(1) is deemed to have been concluded, it was held in the affirmative in holding that it is not merely a conclusion under sub-section (1) but conclusion of all proceedings against such person, that implies conclusion of entire proceeding under the Finance Act, 1994 and taking the circular into consideration in the appellant s case, lenient view may be taken in respect of penalty imposed on the appellant. 4. Ld. AR on the contrary, in citing judicial decisions reported in 2013 (30) STR 3 (Guj)., 2015(39) STR 386 (Mad.), 2015 (38) STR 249 (Tri-Bang.) argued that duty paid by the assessee prior to issue of show-cause would not ipso facto alter the liability of mandatory statutory penalty. He further argued that when appellant tacitly conceded suppression of fact with intent to evade payment of service tax, though paid prior to issue of show-causes but paid only after investigation launched by the department will not provide him the benefit of section 80 of the Finance Act, 1994 and in the instant appeal, contrary to the averment of the appellant that such irregularity was pointed out in the course of routine audit, such evasion of duty was in fact discovered b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ntest penalty only. Penalties covered under Section 78, as imposed is equal to the tax liability which was discharged by the appellant much before issue of show-causes and the same found reflected in the order of the Commissioner (Appeals) passed under para 26. The order-in-original also reveals that the records produced before him clearly establish that commission paid has been duly and fully reflected in the appellant s books of accounts (para 30) but he did not agree with the contention of the appellant that it was inadvertently not paid due to improper interpretation and confirmed the extended period invoked in the showcause notice though set aside penalty imposed under Section 77 on the ground that there was no failure to register and to maintain books of accounts etc. 7. The contention of the appellant that there was no ill intention that can be attributed to evade tax since all the tax liabilities were addressed with due payment of interest after the same being identified by way of audit. This being the circumstantial situation on record, it is imperative to have a look on the provisions contained in Finance Act, 1994 that enables assessment beyond the extended period on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this chapter and rules made thereunder with intend to evade tax payment is to be established and on whom the burden lies. In an adversarial judicial system and as per rule of evidence, burden lies on the person who asserts in the affirmative. Therefore, it is up to the respondent department to establish that the appellant had practised any kind of act contemplated under sub-rue (4) so that penalty can be imposed on it. Going by the adjudication order and also the order passed by the Commissioner (Appeals), it cannot be said to have been established by the department that such practice of fraud collusion etc., were established before those authorities. Since there is a difference between acceptance of executive instruction in paying tax without or with protest and the leviability of such tax as contemplated under Section 265 of the Constitution of India and in the instant case, taxability issue was not discussed by the Commissioner on attainment of the claim by the appellant and the same is beyond the purview of this single bench jurisdiction, having regard to the fact that place of receipt of service was the issue raised by the appellant while the department has levied the se ..... X X X X Extracts X X X X X X X X Extracts X X X X
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