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2016 (4) TMI 155 - CESTAT MUMBAI

2016 (4) TMI 155 - CESTAT MUMBAI - [2016] 94 VST 209 (CESTAT) - Waiver of penalties levied u/s 76,77 & 78 of the Finance Act, 1994 - Provider of services of ‘Manpower Recruitment or Supply Agency' falling under Section 65 (105)(k) of the Finance Act, 1994 - Held that:- appellant on advice of the Jurisdictional Asstt. Commissioner, on his visit to Range Office, agreeing with the Asstt. Commissioner, discharged the entire service tax liability along with interest. Appellant was assured that no fur .....

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oices submitted by the appellant, it is observed that they have neither charged the service tax to their client nor collected any amount towards the service tax. The appellant paid the entire service tax and interest from their own pocket. So, this itself is a burden on the appellant. - When the assessee discharged service tax alongwith interest before issuance of show cause notice penalty has been waived, therefore, when the appellant themselves after discharging the service tax liability .....

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O.P Lalwani, Consultant For the Respondent : Ms. P. Vinita Sekhar, DC (AR) ORDER Per Ramesh Nair This appeal is directed against Order-in-Appeal No. AV(143) 147/2014 dated 4/7/2014 passed by the Commissioner (Appeals) of Central Excise & Customs, Aurangabad wherein he has rejected the appeal filed by the appellant. 2. The fact of the case is that the appellant are providing services of Manpower Recruitment or Supply Agency' to M/s. Godavari Bio-Refinery Pvt Ltd Sakharwadi, Kopargaon, Dis .....

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o year 2005-06 only. However they had not paid service tax for the year 2007-08 and 2008-09 for the amount received from M/s. Godavari Bio-Refinery Pvt Ltd against MRA services provided to the service receiver i.e. M/s. Godavari Bio-Refinery Pvt Ltd. During the visit to the Kopargaon Range Office, the Asstt. Commissioner, Central Excise, Custom & Service, Tax, Ahmednagar division called the representative of the service provider and the service receiver in the Range Office and apprised him a .....

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008-09 total amounting to ₹ 17,23,556/- along with interest ₹ 3,41,869/-. The appellant vide their letter dated 20/10/2010 confirmed the lapses and requested for waiver of SCN to the department, as they have paid the total service tax alongwith interest. Subsequently, a show cause notice was issued and the same was adjudicated wherein demand of service tax was confirmed and the same among which already paid was appropriated. Similarly, interest amount paid was also confirmed and appr .....

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ginal No. 30/ST/ADC/2011 dated 13/12/2011 appellant filed appeal before the Commissioner (Appeals) which was rejected, therefore the appellant filed this appeal only for waiver of penalties. 3. Shri. O.P. Lalwani, Ld. Consultant appearing on behalf of the appellant submits that the appellant is a small time individual service provider. He is only 11 th class passed and had no knowledge about the Service Tax Provisions. As per bonafide belief, he was under impression that he is providing the serv .....

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r waiver of penalty under Section 73 (3) as well as under Section 80 of the Finance Act. He further submits that the appellant's bonafide is proved on the basis that since he was not aware of the service tax provisions, he has neither charged the service tax in his bills nor collected any service tax from the service recipient therefore there is no malafide on the part of the appellant hence the penalties should not have been imposed on the appellant. In support of his submissions, he placed .....

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r of C.Ex. Mumbai-IV [2005 (184) ELT 34 (Tri.Mumbai)] (f) EDC Ltd Vs. Commissioner of Central Excise, Goa [2008 (10) S.T.R. 254 (Tri. Mumbai)] (g) Gupta Coal Field & Washeries Ltd. Vs. Commr. of Service Tax, Nagpur [2013 (29) S.T.R. 166 (Tri. Mumbai)] (h) Sen Brothers Vs. Commissioner of Central Excise, Belapur [2014 (33) S.T.R. 704 (Tri. Kolkata)] (i) Endeka Ceramics India Pvt Ltd Vs. Commissioner of C.Ex. Surat-II [2013 (31) S.T.R. 355 (Tri. Ahmd.)] (j) Avas Engineers Vs. Commissioner of C .....

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aived by invoking either Section 73(3) or Section 80. In support of her submission, she placed reliance on following judgments: (a) High- Tech Calibration Centre Vs. Commissioner of C. Ex. Coimbatore [2006 (2) S.T.R. 357 (Tri. Chennai)] (b) Mulund Gymghana Vs. Commissioner of Service Tax, Mumbai [2009 (15) S.T.R. 543 (Tri. Mumbai)] (c) Quality Welding Works Vs. Commissioner of C.Ex. Ludhiana [2011 (21) S.T.R. 187 (Tri. Del)] (d) Mohammand Mustkeen Vs. Commr. of C. Ex. Chandigarh [2011 (22) S.T.R .....

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re that the appellant paid entire service tax along with interest and opted the waiver of the show cause notice with clear intention that they do not want to contest payment which they have made with a clear view that no action should be taken against them. I find that the appellant is a small time service provider without any higher education background. It is also found that on perusal of the invoices submitted by the appellant, it is observed that they have neither charged the service tax to .....

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no mala fide intention on the part of the appellants in making the late payment of Service Tax. There is also provision in the Finance Act for waiver of the penalty where sufficient cause is shown. As the appellants had already deposited the Service Tax and as there was no mala fide intention in making the delayed payment, the penalty imposed thereof i.e. ₹ 7,105/- is hereby set aside. Penalty of ₹ 1,000/- towards late filing of Return is confirmed. EDC Ltd (supra) 4. On perusal of .....

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efore issuance of show cause notice, the question of imposition of penalty does not arise. The adjudicating authority has held that since the Service Tax liability is accepted and paid by the assessee and they had defaulted the payment for 435 days, an amount of ₹ 43,500/- (@Rs.100/- per day) is imposable as penalty under Section 76 read with Section 77 of the Finance Act. I do not agree with this proposition. 5 . Considering the facts and circumstances of the case, I find that the provisi .....

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ce tax, or the person to whom such tax refund has erroneously been made, may pay the amount of such service tax, chargeable or erroneously refunded, in the basis of his own ascertainment thereof, or on the basis of tax ascertained by a Central Excise Officer before service of notice on him under sub section (1) in respect of such service tax, and inform the Central Excise Officer of such payment in writing, who, on receipt of such information shall not serve any notice under sub-section (1) in r .....

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s paid service tax along with interest and filed the service tax returns on 17.12.2009. Therefore, after waiving the requirement of pre-deposit, we have taken up the appeal itself for final disposal. 7. As discussed above, the show cause notice was not required to be issued to the appellant. Therefore, we do not find any merit in the impugned order qua imposition of penalty on the appellant. Accordingly, the portion of the order imposing penalty is set aside. Appeal and stay application are disp .....

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this case. Revenue has not contested his findings by filing appeal. In view of these facts the appellants' case is fully covered by the provisions of sub-section (3) of section 73 of the Finance Act, 1994. 8. It is not in dispute in this case that the appellant had discharged the entire service tax liability and interest thereof before the issuance of show cause notice. The issue is regarding the imposition of penalty on the appellant under section 76 of the Finance Act, 1994. I find that on .....

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ngalore v. Adecco Flexione Work Force Solutions Ltd. - 2011-TIOL-635-HC-KAR-ST has upheld the ratio that in case the entire amount of Service Tax liability, interest thereon stands paid by the appellant before issuance of show cause notice, hence provisions of section 73(3) of the Finance Act, 1994 should be made applicable and no show cause notice should have been issued. The judgement has been followed by this Tribunal in the case of M.R. Coaltings Pvt. Ltd. vs. CCE, Rajkot - 2013 (30) S.T.R. .....

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g penalty under Section 76 of the Finance Act, 1994 for non-payment of service tax on due dates. 2. The material on record discloses that the assessee on being pointed out by the authorities for not paying the service tax, has paid the service tax with interest even before the issue of show cause notice. Sub-section (3) of Section 73 of the Finance Act, 1994, categorically states that if tax and interest is paid and the same is informed to the authorities, then the authorities shall not serve an .....

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ttled as hereinabove stated, I find that the impugned order is liable to be set aside and I do so. Impugned order is set aside and the Appeal is allowed. Endeka Ceramics India Pvt Ltd (supra) 6. Obviously show cause notice has been issued invoking suppression of facts and therefore we have to see whether in the facts and circumstances of this case suppression of fact or mis -declaration could be alleged. Obviously the Assistant Commissioner had visited the unit before the commercial operations h .....

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h would again show that the payment was made promptly without any delay. Having regard to these facts and having regard to the fact that appellant was eligible for cenvat credit, we find that this was a case where provisions of Section 73(3) was applicable and no show cause notice should have been issued. Further we also find that this is a case where appellants have been able to show reasonable cause for non payment of the tax even if it is assumed that there was delay in payment in view of the .....

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involved in this case is regarding waiver of penalty. The said provisions exist in Section 80 of Finance Act, 1994. The first appellate authority's findings that the adjudicating authority has not invoked the provisions of Section 80 seems to be incorrect as the adjudicating authority has specifically held that waiving penalties imposed under Sections 76, 77 & 78 of Finance Act, 1994, which can be only under the provisions of Section 80. 6. I find that the findings of the adjudicating a .....

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