2004 (11) TMI 1

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....ay tax thereon, nor had they got themselves registered as security service-provider or filed the requisite service tax returns. On the basis of this finding, a show cause notice was issued on 4-4-2002 covering four spells of non-payment of service tax between October 1999 and September 2001. The notice proposed to recover service tax for the said periods under Section 68 with interest under Section 75 as also to impose penalties on the party under Sections 76 & 77 of the Finance Act, 1994. The noticee made part-payment of service tax within three months from the date of the show cause notice. The balance amount of tax was paid later on, before the case was adjudicated by the original authority. The said authority in its order confirmed the ....

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....all be liable to pay penalty equal to ten times the amount of entry tax" occurring in Section 7(5) of a Madhya Pradesh Act of 1976 was interpreted by their lordships and it was held that the assessing authority had the discretion to levy a lesser amount of penalty. After drawing a parallel between the above provision of the Madhya Pradesh Act and the provisions of Section 76, ld. Counsel argues that the lower authorities ought to have considered the facts and circumstances of the case and to have exercised discretion in determining the quantum of penalty to be imposed under Section 76. It is also pointed out by Counsel that no speaking order has been passed by the lower appellate authority. Ld. Counsel has also advanced arguments with regar....

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....aid Section, the rate of interest chargeable was 24% per annum from 17-6-2001 and 15% per annum from 16-8-2002. The liability to pay interest at these rates for the respective periods is inescapable as the provision of law does not confer any discretion in the matter of levying interest. The interest charged by the lower authorities is, therefore, sustained. As regards the penalty imposed under Section 75, however, ld. Counsel appears to have made a valid point on the strength of the Apex Court's ruling in the case of Bharat Heavy Electricals (supra). While construing the expression "shall be liable to pay penalty equal to ten times the amount of entry tax," their lordships held that a lesser amount of penalty could be levied by the assessi....