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TMI Blog2018 (11) TMI 1458X X X X Extracts X X X X X X X X Extracts X X X X ..... of accounts by the Internal Audit Group of Service Tax Commissionerate, Chennai it was noticed that the appellant charged M/s. IBM for Maintenance and Repair service and also collected service tax. The assessee being a proprietorship concern was required to pay service tax on quarterly basis, but however failed to deposit the service tax of Rs. 1,06,47,157/- within the due dates as specified under Section 68 of the Finance Act, 1994. It is the case of the assessee that they had to pay salary to their staff, PF, ESI and other statutory dues to their staff which created a huge cash flow problem and hence the service tax payment was delayed for the period from April 2007-08. Consequent to the visit of the Audit Officers of the Department, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... only after the visit of the Audit Officials subsequent to which they had paid the same along with interest; as the assessee had paid the entire tax liability on being pointed out, the Show Cause Notice should not have been issued. 3.2 He further submitted that the tax liability was paid much prior to the Show Cause Notice and that there was no mala fide intention i.e. suppression, intention to evade payment of tax, etc., on the part of the appellant and prayed for waiver of penalty. He further submitted that an identical issue has been considered by CESTAT, Chennai in the case of M/s. Dusters Total Solutions Services Pvt. Ltd. Vs. CST, Chennai in Appeal No. ST/00090/2012, wherein this Bench vide Final Order No. 41943/2018 dated 06.07.2018 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f issue of Notice, the competent authority may have taken the view that the provisions of Sub-section 4 of Section 73 ibid. are present in the case and, hence, Show Cause Notice will require to be issued. In fact, we are not finding fault with the issue of the Show Cause Notice in this case. But once it has been found, albeit by hindsight and pursuant to adjudication proceedings, that the ingredients of Section 73(4) ibid. are not present, and the notice would otherwise not have been required to be issued, this by itself, in our view, is a reasonable cause to invoke the provisions of Section 80 ibid. for waiver of any remaining penalties that may have been issued by the adjudicating authority. The Ld. AR had argued that financial hardship c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ucture Ltd. Vs. C.C.E. & S.T., Coimbatore, (supra) has occasion to analyse a similar issue. The relevant paragraph is noticed as under : "6. I have considered submissions on both sides. Imposing penalty equivalent to Service Tax paid belatedly in this case will amount to putting the appellant who paid tax before issue of SCN and interest before adjudication at a more disadvantageous position as compared to an assessee who would not have paid any tax and did not file any return. In latter type of cases penalty under Section 78 would be applicable and the assessee gets concession in paying 25% of duty as penalty if such payment is made promptly. The argument raised by Revenue can be canvassed even in a situation wherein an assessee pays bot ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 80 begins with a non obstante clause and, hence, has overriding effect on Sections 76, 77 and 78 of the Act ibid. 5.11 From the above discussions and the decisions cited supra, we are of the considered opinion that the penalty imposed under Section 76 requires to be set aside which we hereby do. The impugned order is modified to the extent of setting aside the penalty imposed under Section 76 only. 6. The appeal is allowed partly in above terms, with consequential reliefs, if any." 7. We find that the above ruling squarely applies to the facts of the case on hand as there is no change with regard to facts. Going therefore by the ratio laid down in the above case, we are of the considered view that the penalty imposed is not proper and t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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