2007 (8) TMI 336 - AT - Service Tax

Appellants' Tax Penalty Overturned for Timely Payment

The penalty imposed on the appellants for late payment of tax on services of a goods transport agency was set aside. The judicial member found that the ... Waiver of penalty – section 80 – reasonable cause – held that - There is no allegation of deliberate fraud, collusion, suppression of facts and wilful mis-statement on the part of the appellants. Therefore, following the decision of the Tribunal and the Board’s Circular, the penalty imposed on the appellants is set aside. The appeal is allowed with consequential relief Issues involved:Imposition of penalty for late payment of tax on services of goods transport agency.Analysis:The issue in this case revolves around the imposition of a penalty for the late payment of tax on the services of a goods transport agency. The appellant submitted that they paid the tax on a specific date for a particular period and also paid interest before the issuance of the show-cause notice. The appellant relied on a Tribunal case and a Circular of the Board to support their argument. The Tribunal, in a similar situation, set aside the penalty based on the Circular, which limited consequences to recovery of tax with interest unless deliberate fraud, collusion, suppression of facts, or wilful mis-statement occurred.Upon reviewing the submissions from both parties and examining the records, the judicial member found that the appellants had paid their tax before the specified date and fell within the purview of the Board's Circular. There were no allegations of deliberate fraud, collusion, suppression of facts, or wilful mis-statement against the appellants. Consequently, following the Tribunal's decision and the Board's Circular, the penalty imposed on the appellants was set aside. The appeal was allowed, granting consequential relief to the appellants.