2018 (7) TMI 1219 – CESTAT CHENNAI – TMI – Penalty u/s 78 of the Finance Act, 1994 – case of appellant is that non-payment was due to the financial crisis and for the delay in payment of service tax there was no willful intention to evade tax – Held that:- The facts put forward as well as the records would show that other than delay in payment of service tax, there is no evidence to show that appellant has suppressed facts with intention to evade payment of tax – The figures required for quantification of the demand of service tax has been taken from the accounts maintained by the appellant and there is nothing unearthed by the department to show that there was any positive act of suppression on the part of the assessee.
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This is a fit case for invoking Section 80 of the Finance Act, 1994 as the appellant has put forward reasonable cause for non-payment of service tax during the disputed period – penalty set aside, without disturbing the demand confirmed as well as the interest
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med the demand of ₹ 11,88,182/- along with interest and imposed equal penalty under Section 78 with an option to pay reduced penalty of 25%. The amount already paid by the appellants to the tune of ₹ 11,88,182/- as well as the interest amount was appropriated. Appellant filed appeal before the Commissioner (Appeals) who upheld the same. Hence this appeal. 2. On behalf of the appellant, Ld. Counsel Shri M. Karthikeyan submitted that non-payment of service tax was only due to financial hardship and there was no intention to evade payment of tax. It is stated in the grounds of appeal that during the impugned period, there was global recession and the business all over the world was getting into a slump. Appellant s business also suffered serious loss. Few payments received by them were barely enough to pay staff / workers and their salaries. Despite this financial crunch, appellant had taken all efforts to realize the payments but could not succeed. When the payments were rece
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. Ld. A.R Shri A. Cletus supported the findings in the impugned order. He submitted that appellants had collected the service tax but had not paid the same. The non-payment of service tax would not have come to light but for the interference by the department. The suppression of facts is thus very much evident and the penalties imposed are legal and proper. 4. Heard both sides. The Ld. counsel for the appellants has submitted that they are contesting only the penalty imposed under Section 78 of the Finance Act, 1994. It is vigorously argued by the appellant that non-payment was due to the financial crisis and for the delay in payment of service tax there was no willful intention to evade tax. Ld. counsel relied upon the decision in Vista Infotech Vs CST Bangalore – 2010 (17) STR 343 (Tri.-Bang.) and argued that penalty is unwarranted when there is mere delay in payment of service tax. The facts put forward before us as well as the records would show that other than delay in payment of
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