AI Drafter 
TaxTMI 
TaxTMI 
2015 (9) TMI 477
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....providing these barges and tugs on hire basis to various customers. Subsequently, a show cause notice F. No. DGCEI/AZU/36-88/2011-12/4020 dated 22.11.2011 was issued to the appellants on the ground that the appellants have not paid appropriate service tax in time. The adjudicating authority vide OIO dated 31.01.2013 confirmed the demand of service tax of Rs. 30,93,660/- and appropriated the amount of Rs. 21,84,494/- already by them. He also confirmed interest and appropriated an amount of Rs. 2,15,617/- already paid by them. He also imposed penalty of Rs. 5,000/- under Section 77 of the Finance Act, 1994 and a penalty of equivalent tax of Rs. 30,93,660/- on the appellants. Being aggrieved by the said OIO dated 31.01.2013, the appellants pre....
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.... of the statement, reproduced at para 4.5 of the show cause notice dated 22.11.2011 which reads as follows:- "4.5 On being asked whether service tax was paid from time to time, he stated that they could not pay service tax within the due date due to financial constraint. However, they have paid service tax as per the details given below. (Copies of GAR challans are produced herewith):- Sr. No GAR Challan Date Period for which paid Amount of service tax Edu. Cess & SHE Cess Interest 1 04.07.2011 July 2008 to Sept. 2008 63,540/- 1,906/- 20,676/- 2 04.07.2011 Oct. 2008 to Dec 2008 40,863/- 1,226/- 11,918/- 3 31.03.2011 Jan 2009 to Mar 2009 2,51,323/-7,539/-67,304/- 4. 31.03.2011 April 2009 to Jun....
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....on that there was no intention to evade payment of tax. 4. The learned Chartered Accountant further submitted that there was no necessity to issue show cause notice to the appellants, far less any question of imposition of penalty on the appellants. He also drew attention of the Bench to the provisions of Section 73(3), which are reproduced below:- (3) Where any service tax has not been levied or paid or has been short-levied or short-paid or erroneously refunded, the person chargeable with the service tax, or the person to whom such tax refund has erroneously been made, may pay the amount of such service tax, chargeable or erroneously refunded, on the basis of his own ascertainment thereof, or on the basis of tax ascertained by a Cen....
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....ountant. He reiterated the findings of the lower authorities and submitted that since the appellants had not paid the service tax in time, they had violated the provisions of the Act, and therefore penalty imposed on the appellants is proper and justified. 6. On perusal of the records and considering the submissions made by both sides, it is seen that the matter is no more res-integra. The Division Bench of the Karnataka High Court in the case of CCE & ST, LTU, Bangalore vs. Adecco Flexione Workforce Solutions Limited 2012 (26) STR 3 (Kar), had held that assessee is not liable to pay any penalty under such circumstances. For better appreciation, relevant portion of the said decision is reproduced below:- 2. Facts are not in dispute. T....
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....d the express provision as contained in sub-sec. (3) of Sec. 73. The Parliament has expressly stated that against persons who have paid tax with interest, no notice shall be served. If notices are issued contrary to the said Section, the person to be punished is the person who has issued notice and not the person to whom it is issued. We take that, in ignorance of law, the authorities are indulging in the extravaganza and wasting their precious time and also the time of the Tribunal and this Court. It is high time that the authorities shall issue appropriate directions to see that such tax payers are not harassed. If such instances are noticed by this Court hereafter, certainly it will be a case for taking proper action against those law br....