TMI Blog2008 (2) TMI 140X X X X Extracts X X X X X X X X Extracts X X X X ..... category of Management Consultancy Services . 4. We heard both the sides. The Revenue proceeded against the appellants by issuing a Show Cause Notice dated 9-9-2003 on the ground that they had not paid the Service Tax amounting to ₹ 24,33,219/- for the month of August 2001, September 2001 and February 2002. Interest was demanded under Section 75 of the Finance Act. Penal provisions were invoked under Sections 76 78 of the Finance Act, 1994. The adjudicating authority after going through the records of the case and after giving a personal hearing to the appellants dropped the demand of service tax as the same has already been paid by the Noticee on 28-2-2002. He also dropped the imposition of penalty under Sections 76 78 of the Finance Act. The revisionary authority, Commissioner of Service Tax, Bangalore, examined the order of the Assistant Commissioner dropping the proceedings and came to the conclusion that the said order was not legal and proper on several grounds. According to the revisionary authority, the Asst. Commissioner dropped the proposal to impose penalty by arbitrary exercise of powers conferred under Section 80 of the Finance Act, 1994. The assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Government Account. Moreover, the Commissioner has not discussed the case laws cited by the appellants. He has made a general statement that the contention of the assessee that the service tax and interest are paid before the issue of the show cause notice, no penalty is warranted, is entirely misconceived and contrary to the provisions of law. He also observed the provisions laid down under service tax is not in pari materia with the Central Excise provisions. After observing the above, he set aside the order of the Assistant Commissioner with regard to waiver of penalty under Sections 76 78 of the Act. He imposed penalty of ₹ 100/- for everyday during which the failure to make payment continued, under Section 76 of the Act. He imposed penalty of ₹ 30,00,000/- on the appellants under the provisions of Section 78 of the Act. The appellant is highly aggrieved over the impugned order of the Commissioner. Hence they come before the Tribunal for relief. 7. The learned Advocate who appeared on behalf of the appellants invited our attention to the following decisions of the Tribunal :- S.No. Case law Gist ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6. ETA Engg. Ltd. v. CCE [2006 (3) S.T.R. 429 (T.- LB) = 2004 (174) E.L.T. 19 (T. - LB] Penalty not imposable when there was bona fide belief regarding the non-coverage of activity and when the reason has been clearly given in the Order-in-Original in terms of Section 80, notwithstanding the provisions of Section 76, 77, etc. 7. CCE v. Impress Ad-Aids Displays [2006 (3) S.T.R. 385 (T-Ban.) = 2004 (173) E.L.T. 137 (T)] Service Tax being new levy and service tax being deposited along with interest exorbitant penalty not imposable. This principle laid down by following the decision rendered in the case of Sunitha Shetty which has been upheld by the Hon'ble High Court in the above said decision reported in 2006 (3) S.T.R. 404 (Kar.) = 2004 (174) E.L.T. 313. 8. The Financers v. CCE - 2007 (8) S.T.R. 7 (T. - Del.)] Opus Media Entertainment v. CCE - 2007 (8) S.T.R. 368 (T.- Del.) Penalties both under Section 76 and 78 simultaneously not imposable as both the provisions are mutually exclusive and since Sectio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e, we find that the following facts are not disputed. The appellants are liable to service tax under the category of Management Consultancy Services . It is also on record that they had paid the service tax amount of ₹ 24,43,770/- by challan dated 28-2-2003 and the interest to the tune of ₹ 4,34,380/- by challan dated 24-2-2003. The Original authority after verifying the facts on records came to the conclusion that the above service tax paid relates to August 2001, September 2001 February 2002. The show cause notice was dated 9-9-2003. As we can see clearly that the show cause notice was issued in September 2003 whereas the appellants paid the service tax along with interest even in February 2003 April 2003. Therefore it is clear that even before the issue of show cause notice, the appellant had paid the service tax along with the interest. They have also stated that they could not pay the service tax in time on account of the following reasons. These reasons have been re corded in Para 3 of the Order-in-Original. (i) The service tax has to be paid only on realization; (ii) The service tax for the invoices raised in the following months 8/01, 9/01 and 2/02 fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e was no suppression of material as alleged in the show cause notice in as much as it is found that whatever service tax realized during the relevant period from August 2001 to July 2002, the appellants had discharged the same in full along with interest at the applicable rate. In this connection, we would like to reproduce the finding of the original authority in Para 7 of the order. 7. The issue involved in this case is that whether the payment of service tax on the service charges realized has been made by the due date and in the case of delayed payments, whether the interest at the applicable rate has been discharged. For this reason, I have verified the invoices raised for the service charges during the relevant period in question and the vouchers of money realization by the Company vis-a-vis the payment of service tax made through their TR 6 challans produced and found that in some cases, they have discharged the service tax in time and in some cases they have delayed the payments. In the case of delayed payments, they have paid the interest at the applicable rate. It is also observed that there was no suppression of the material fact as alleged in the show cause notice i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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