M/s Wipro Enterprises Ltd. Versus The Commissioner of Customs, Central Excise & Service Tax, Tirupati – GST
Service Tax
2018 (7) TMI 435 – CESTAT HYDERABAD – TMI
CESTAT HYDERABAD – AT
Dated:- 2-7-2018
Appeal Nos. ST/30480-30481/2018 – Final Order No. A/30643-30644/2018
Service Tax
Hon'ble Mr. P. Venkata Subba Rao, Member ( Technical )
Shri R. Rajesh, for the Appellant
Shri Arun Kumar, Deputy Commissioner (AR) for the Respondent
ORDER
[ Order Per : P. Venkata Subba Rao ]
These two appeals are filed by the appellant against Order-in-Appeal No. TTD-EXCUS-000-APP-130-17-18 dated 23.02.2018 & Order-in-Appeal No. TTD-EXCUS-000-APP-131-17-18 dated 27.02.2018.
2. Heard both sides and perused the records.
3. The facts of the case in brief are that the appellants are engaged in the manufacture of Hydraulic Cylinders and are registered with Central Excise. They are also registered with the Department under service tax provisions for payment of service tax under the c
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not reconciled his accounts even after lapse of more than one year from the relevant date. It clearly shows that the assessee has willfully evaded payment of appropriate service tax and taking a chance of non-detection conducted by the Department. Accordingly, it was proposed to demand the service tax invoking the extended period along with interest. It was also proposed to impose a penalty under Section 78. After following the due process of law, the Learned Assistant Commissioner had confirmed the demands along with interest and imposed penalties under Section 75 and 78 of the Finance Act, 1994.
4. Aggrieved, the appellant filed an appeal before the Commissioner (Appeals) who upheld the Order-in-Original and dismissed the appeals. Learned Commissioner (Appeals) rejected the claim of the appellant that there was no suppression of facts and hence the proviso to Section 73(1) cannot be invoked and neither can penalty can be imposed under Section 78. He concluded with the appellant had
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the Order-in-Original and prayed that the penalty under Section 78 may be set aside.
6. The Learned Departmental Representative on the other hand, reiterated the arguments made in the Order-in-Original and Order-in-Appeal and said that the mandatory penalty under Section 78 cannot be set aside because there was a suppression of facts. He relied upon the judgement of Hon'ble High Court of Karnataka in the case of Commissioner of Customs, Mangalore Vs. Jindal Vijayanagar Steel Ltd., [2017 (346) ELT 378 (Kar.)] and relying on the judgment of the Apex Court in the case of Union of India Vs. Rajasthan Spinning & Weaving Mills [2009 (238) ELT 3 (S.C.)] wherein it was held that mandatory penalty does not get altered because of the fact that the assessee had paid the duty prior to issue of show cause notice. This judgment of the Hon'ble High Court of Karnataka was appealed against by the assessee but upheld by the Hon'ble Supreme Court. He further relied on the judgment of the Hon'ble High Co
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on, fraud, misstatement etc., with an intent to evade payment of duty would call for imposition of penalty to the extent of 100% of tax evaded. At this stage, reference can be made to Tribunal's decision in the case of wherein vide Final Order No. 41600/2017, dated 09.08.2017, the Tribunal discussed all the provisions of penalties in terms of the Finance Act, 1994 invoking the provisions of section 80 and has held that the same is not applicable in cases of suppression and fraud etc. In such circumstances, no fault can be found with the findings of the Commissioner (Appeals) order. Accordingly, appeal filed by the assessee is rejected.
In view of the above, the Learned Departmental Representative argued that the fact a lower value was declared in the ST-3 returns is sufficient invoking penalty under Section 78 of the Finance Act, 1994. This mandatory penalty does not get altered by the fact but they have paid service tax as well as interest well before the issue of show cause notice.
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