TaxTMI 
TaxTMI 
2010 (8) TMI 270
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.... of records of M/s. Bharath Sanchar Nigam Limited, Mangalore, (hereinafter referred to as "BSNL" for short), it was observed that the assessee had provided Security Agency Service to them for the period from 1-5-2001 to 31-3-2002 against payment of Rs. 18,84,141. However, the assessee had not paid the service tax on the said taxable value nor filed the ST3 return as required. Therefore, a show-cause notice was issued to the assessee, alleging that they have contravened sections 68 and 70 of the Finance Act, 1994 (for short, hereinafter referred to as the "Act") and that they have concealed/suppressed the value of the taxable service with intent to evade payment of service tax and thereby rendered themselves liable for penal action under sec....
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....d order, the assessee preferred an appeal to the Commissioner of Central Excise. Though the Appellate Authority did not find fault with the approach of the Assessing Officer, in imposing penalty, it observed that non-payment of service tax and non-filing of returns in this case establishes suppression of value of taxable service. However, taking into account the fact that the assessee paid the tax and interest before issue of show-cause notice, the case calls for lenient treatment with regard to penalty. Therefore, the Appellate Authority reduced the penalty to Rs. 20,000 under both sections 76 and 78 of the Act and in all other respects, confirmed the order of Assessing Authority. 3. Aggrieved by the said order, the revenue preferred an a....
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....n imposed as penalty, the Appellate Authority had no jurisdiction to interfere with the said imposition of penalty and reduce it to Rs. 20,000 without any basis. The Tribunal committed a serious error in not interfering with such an order, which is one without jurisdiction and therefore, he submits a case for interference is made out. 5. The material on record discloses, the assessee had registered himself under the Act as a service provider. In respect of consideration received for the service rendered in respect of other clients, he had promptly paid the service tax due under the Act. It is only in respect of BSNL, a Government of India undertaking, he had not paid the service tax and in the returns, the receipt of the consideration from....
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.... pay the penalty. Therefore, the contention that the first Appellate Authority had no jurisdiction to reduce the penalty imposed by the Assessing Authority is incorrect. 6. On the merits of the case, it is clear that the assessee has been prompt in paying the service tax in respect of other customers other than BSNL, which is a Government of India undertaking. From the explanation offered and his subsequent conduct, it is obvious probably entertaining a genuine doubt, whether the service tax is payable in respect of a service rendered to BSNL, a Government of India undertaking? and as they did not pay any service tax, in turn, he did not pay the service tax and after issue of show-cause notice, demanded BSNL to pay service tax which they d....