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of <h1>Appeal granted, penalties overturned under Act Sections 78 & 77(2) due to timely payment and compliance.</h1> <h3>M/s. Deccan Park Resorts Versus Commissioner of GST & Central Excise, Coimbatore</h3> M/s. Deccan Park Resorts Versus Commissioner of GST & Central Excise, Coimbatore - TMI Issues:Appeal against order of Commissioner of Central Excise (Appeals), Coimbatore seeking deletion of penalties under Section 78 and Section 77(2) of the Act.Analysis:1. Facts and Background:- The appellant, a service tax registrant for short term accommodation service, received a Show Cause Notice (SCN) for failure to obtain service tax registration and deposit collected service tax. Various propositions were made in the SCN regarding demand of service tax, interest, and penalties.2. Initial Orders:- The adjudicating authority confirmed the demand of service tax, imposed penalties under Section 77(2) and Section 78 proviso (i). The appellant appealed against the penalties, arguing that they had paid tax and interest before the SCN was issued, and there was no suppression.3. Appellate Tribunal's Consideration:- The main issue was the applicability of the 2nd proviso to Section 78, which requires payment within 30 days of the notice under Section 73(1). The appellant contended that this provision was not satisfied in their case.- The appellant cited relevant case laws to support their argument, emphasizing that penalties should not be imposed when the duty and interest were paid before the SCN.- The Department Representative supported the lower authorities' findings.4. Tribunal's Decision:- The Tribunal referred to previous judgments where penalties were set aside when the duty and interest were paid promptly after detection of short payments.- Relying on these precedents, the Tribunal concluded that the penalty of 15% under the 2nd proviso to Section 78 was unjustified as the duty and interest were paid well before the SCN.- Additionally, since the appellant had obtained registration before the SCN, there was no violation of Section 77(2). Hence, the appeal was allowed, and penalties were deleted.5. Final Verdict:- The Tribunal's decision, pronounced on 20.06.2018, favored the appellant by allowing the appeal and setting aside the penalties imposed under Section 78 and Section 77(2) of the Act.
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