TMI Blog2016 (8) TMI 1123X X X X Extracts X X X X X X X X Extracts X X X X ..... rovider has been their breach of obligation to deposit the tax collected. No reason to disbelieve their claim of inability to pay tax owing to lack of funds. Such possibilities can and do occur in the world of business. That, however, does not confer immunity from being proceeded against for failure to comply with tax obligations. There is also no doubt that there is an obligation cast upon every service provider to collect the tax due through the service recipient and deposit the amount with the exchequer. However, the law does contemplate and is not averse to use of the tax so collected within the business till the stipulated date for payment. That this period was unilaterally extended by the assessee is not in dispute. Yet, the cont ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 006 to April 2007, did not discharge their obligations to pay tax and file the returns thereafter. 2. Before the original authority, M/s Shlok Media Pvt Ltd submitted that they had been regular in paying service tax on the basis of billings till March 2006 and thereafter on receipt basis. It was claimed that some of their clients had defaulted on payments leading to financial crisis which prevented them from discharging their tax obligations. It is observed that assessee had deposited an amount of ₹ 71,85,266/- towards tax and interest for the period between April 2006 and April 2007. 3. Revenue is also in appeal as penalty imposed under section 76 of the Finance Act, 1994 in the impugned order is not in consonance with sectio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Hon ble Supreme Court in Union of India v. Dharmendra Textile Processors [2008 (231) ELT 3 (SC) which held that mandatory penalty in tax statutes cannot be diluted for any reason whatsoever. 6. It is seen that the appellant-assessee claims that they are in the business of display of advertising and hoarding and leasing of hoardings and therefore are not liable tax prior to 1st May 2006 when section 65(105)(zzzm) to incorporate 'sale of space or time for advertisement' in section 65(105) of Finance Act, 1994. Undoubtedly, the decisions cited by Learned Chartered Accountant do distinguish the two services and may well support the claim of assessee. Nevertheless, having assessed themselves to tax under the other service and paid t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... here is also no doubt that there is an obligation cast upon every service provider to collect the tax due through the service recipient and deposit the amount with the exchequer. However, the law does contemplate and is not averse to use of the tax so collected within the business till the stipulated date for payment. That this period was unilaterally extended by the assessee is not in dispute. Yet, the contention of the assessee that delay is not evidence of intention to evade tax is not one that can be dismissed out of hand. A delay is, without doubt, a delay but, in the absence of any other convincing evidence, is more reflective of lack of promptitude than deliberate evasion. Tax and interest were paid without waiting for a show caus ..... X X X X Extracts X X X X X X X X Extracts X X X X
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