TMI Blog2018 (2) TMI 2026X X X X Extracts X X X X X X X X Extracts X X X X ..... OURT ] , that the levy of penalty imposed on the ground of delayed payment of Service Tax was set aside as the tax was paid prior to issuance of show cause notice. However, the present case has a distinguishable feature. In the present case, the undisputed fact reveals as reflected from the Order of the Assessing Officer that the assessee came up with a plea before the Assessing Officer that he has rendered services to Karnataka State Financial Corporation (KSFC) and it is the KSFC which has not cleared the bills of the assessee and in those circumstances, the assesee was not able to pay service tax - it is also established that non-payment of Service Tax was not due to delay but on the contrary it was willful non payment of service tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te Finance Corporation to conduct the internal audit for a monthly consideration of ₹ 4.5 lakhs plus service tax from December 2005 onwards and was receiving regular fees plus the service tax, on verification, it was revealed to the Department that the assessee has not discharged any Service Tax from April-2005 to September-2007 and also not filed ST3 return. Investigation started against the assessee and the assessee was summoned with relevant documents vide letter dated 08.08.2007. The assessee did not produce any documents and kept on asking for more time and therefore summons dated 18.09.2007 was issued to Sri V.K.Niranjan, partner of M/s. Niranjan Co., to appear before the Superintendent of Service Tax and Anti-Evasion on 24.09 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rest prior to the issuance of show cause notice? 2. Whether the proceedings under Section 73(3) of the Finance Act, 1994 in this matter could be said to be justified by any of the reasons stated in sub-section(4) of Section 73 of the Act? 5. The learned counsel for the assessee has vehemently argued before this Court that keeping in view Section 73 of the Finance Act of 1994, question of imposition of penalty and interest does not arise as the amount of Service Tax was paid prior to issuance of show cause notice. In support of his contentions, he has placed reliance upon three judgments delivered by the Division Bench of this Court i) Commissioner of Service Tax v. C.Ahead Info Technologies India Pvt. Ltd. (2011 SCC Online Ka ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e has been issued prior to payment of tax, he will be liable for payment of penalty. 8. In the present case, the undisputed fact reveals as reflected from the Order of the Assessing Officer that the assessee came up with a plea before the Assessing Officer that he has rendered services to Karnataka State Financial Corporation (KSFC) and it is the KSFC which has not cleared the bills of the assessee and in those circumstances, the assesee was not able to pay service tax. The order passed by the Assessing Authority makes it very clear that the KSFC vide letter dated 19.12.2007 has informed the Assessing Officer showing the full details of the amount and Service Tax paid to the assessee with dates of payment and in those circumstances, it w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e amount of service tax liability stands collected but not deposited with the Government of India, question of invoking Section 80 does not arise. Accordingly I find that the appeal as regards setting aside the penalty under sections 77 and 78 is devoid of merits and liable to be rejected and I do so. 7. In view of the foregoing, the impugned order to the extent it upholds the penalty under Sections 77 and 78 of the Finance Act 1994 is upheld and the appeal stands disposed of as indicated hereinabove. 9. In the light of the categorical finding of fact arrived at by the Assessing Officer keeping in view Section 73(4) of the Finance Act of 1994, merely because tax was paid before the issuance of show cause notice, it can never be sa ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
