Repeated service tax default justified no further penalty reduction where prior leniency had already been extended.

Repeated delays in depositing service tax and filing returns, ranging from 1 to 292 days, were treated as continued non-compliance under the penalty provisions. The appellate authority had already taken a lenient view and substantially reduced the penalties, but the appellant, despite being a registered service provider and having paid the tax with interest, offered no sufficient justification for the repeated defaults. On that basis, no further reduction in penalty under Sections 76 and 77 of the Finance Act, 1994 was considered warranted, and the appeal was rejected.

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Issues: Whether the penalties imposed under Section 76 and Section 77 of the Finance Act, 1994 for delayed deposit of service tax and late filing of returns called for further reduction.

Analysis: The appellant had defaulted on multiple occasions over a prolonged period, with delays ranging from 1 to 292 days. The appellate authority had already reduced the penalties substantially by taking a lenient view. The appellant had deposited the service tax along with interest, but no sufficient justification was shown for the repeated delays, despite being a registered service provider aware of the tax liability.

Conclusion: Further reduction in penalty was not warranted, and the appeal was rejected.

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