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of <h1>Waiver of Penalty Pre-Deposit Granted in Discretionary Powers Case</h1> <h3>Farid Bikes Pvt. Ltd. Versus The Commissioner of Service Tax</h3> The Bench granted waiver of pre-deposit of penalty amounts in a case involving conflicting High Court judgments on discretionary powers for penalty ... - Issues involved: The issue involves seeking waiver of pre-deposit of penalty amount under Section 76 and 77 of the Act, discretionary powers for imposition of penalty, conflicting views of High Court judgments, and the authority's power to exercise discretion in dropping the penalty.Summary:Issue 1 - Waiver of pre-deposit of penalty amount:The appellant sought waiver of pre-deposit of penalty amount of &8377; 75,000/- and &8377; 1,29,000. The Assistant Commissioner initially dropped the penalty proceedings, but the Commissioner later imposed the penalty. The appellant's counsel referred to previous cases where waiver was granted in similar circumstances. The learned Counsel highlighted that the levy of penalty under the mentioned Sections is discretionary and not for minor breaches, citing a High Court judgment. The appellant argued for waiver, while the JDR contended that the penalty imposition was justified based on a different High Court judgment.Issue 2 - Consideration of submissions:After considering the arguments from both sides, the Bench noted that in a similar case, waiver of pre-deposit was granted by the Bench. The High Court had previously acknowledged the discretionary power of imposing penalties and the authority's ability to drop penalties. Despite a conflicting judgment setting aside the Bench's decision, the matter was to be further examined during the final hearing. The Bench allowed the stay applications by granting waiver of pre-deposit and staying the recovery until the appeals' disposal. All similar cases related to penalty levy were scheduled for a final hearing on December 5, 2007, and these appeals were to be included in the same hearing.This judgment highlights the legal complexities surrounding the imposition and waiver of penalties, emphasizing the discretionary nature of such decisions and the need for thorough consideration during final hearings.
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