TMI Blog2016 (11) TMI 320X X X X Extracts X X X X X X X X Extracts X X X X ..... reasonable cause exists whereas the same is not available under Central Excise law - In the present case, as seen above, there is no suppression of facts with an intention to evade payment of duty and accordingly a reasonable cause is present to invoke Section 80 of the Finance Act, 1994 - Decided in favor of the assessee. - Appeal No. ST/41276/2015 - ORDER No.40731/2016 - Dated:- 5-5-2016 - Shri P.K. Choudhary, Judicial Member Shri K.P.Muralidharan, AC (AR), For the Appellant Shri Rajaram Ramanan, Consultant, For the Respondent Order Before going into the merits of the case, although the Order-in-Appeal is common, the issues involved are different, the case is disposed by separate orders. 2. The facts of the case are that M/s. Cognizant Technology Solutions (hereinafter referred to as Respondent ) was subject to audit by the Service Tax authorities. During the course of audit conducted by the authorities, it was noticed by the Revenue that service tax under reverse charge mechanism was not deposited for the services received from the foreign vendors to the tune of ₹ 12,90,540/-. The Respondent-assessee had agreed to the aforesaid observation of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er proviso to Section 73(1) of the Finance Act, 1994 and consequently no waiver of penalty is possible under Section 80 of the Finance Act, 1994; that the case law relied by the Commissioner (Appeals) in the case of Atwood Oceanics (supra) has not been accepted by the Department and that an appeal has been preferred before the Supreme Court; that in the case of UOI vs. Dharmendra Textile Processors - 2008 (231) ELT 3 (SC), the Supreme Court has held that any penalty otherwise imposable under Section 11AC of the Central Excise Act, 1944 cannot be avoided on the ground that the duty amount was paid by the assessee prior to issuance of show cause notice. 6. Shri K.P. Muralidharan, A.C., Ld. A.R appearing for the Appellant, re-iterated the grounds of appeal and stated that equal penalty ought to be levied in the present case. He also placed reliance on the ruling of the Madras High Court in the case of Dhandayuthapani Canteen Vs CESTAT, Chennai - 2015 (39) S.T.R. 386 (Mad.) , wherein it was held that even though tax has been paid prior to issuance of show cause notice, Section 80 waiver cannot be provided where willful suppression and concealment has been proved. 7. Shri Rajar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sing the records, I find that the short issue involved in the said appeal is that whether equal penalty is to be levied in the present case as it is an undisputed fact that tax along with interest stands paid. I find that the Respondent has failed to pay service tax under reverse charge mechanism during the period 2006-07 and upon being pointed out by the DGCEI authorities they have paid the tax along with interest before issuance of show cause notice. As the whole dispute has arisen on the ground of allegation of willful suppression it is necessary to analyze whether there was any willful suppression or not. The Respondent is a member of the LTU. Their office was frequented by the Department officials/Appellant and their records were scrutinized. All the facts were known to the Department when they had visited the Respondent s premises. When there is knowledge on the side of the Department the invocation of extended period alleging suppression of facts with an intention to evade payment of duty would not arise. The contention of the Respondent that merely because there was a lapse, the same should not be construed as suppression is well founded. The Supreme Court in the case of Ja ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch we agree, support the view that provisions of Section 80 are required to be invoked for waiving penalty imposed under Section 78 of the Finance Act, 1994 on M/s. Atwood . The Appellant had contended that this case has not been accepted by the Department and an appeal has been preferred in the Supreme Court. I find that the argument of the Appellant is not tenable in view of the principle laid down by the Hon ble Supreme Court in the case of UOI Vs Kamlakshi Finance Corporation Ltd. 1991 (55) ELT 433 (SC), wherein it was held that mere fact of filing an appeal can furnish no ground for not following a judicial pronouncement unless its operation has been suspended by a competent Court. In this case, I find that only omission on the part of the Respondent was non-payment of tax and that they have paid the same along with interest upon intimation by the DGCEI. I find that there is no suppression much less a willful suppression on the part of the Respondent to evade payment of tax which is a pre-requisite for invocation of extended period and imposition of penalty. The Appellant had relied on the ruling of the Madras High Court in the case of Dhandayuthapani Canteen (supra) where ..... X X X X Extracts X X X X X X X X Extracts X X X X
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