2016 (5) TMI 1244

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....hat the respondent assessee had received services from foreign firms who do not have any office in India and were liable to pay tax under reverse charge as per Section 66A of the Finance Act, 1994 under the category of "Banking and other Financial Services" to the tune of Rs. 3,27,266/- and a sum of Rs. 7,78,841/- towards Sponsorship Service was also demanded as it appeared that some of the transactions are not in the nature of donations but given under an obligation to get something in return, such as display of banners in sponsors name or entitled for certain privileges; that the respondent assessee is under the jurisdiction of LTU and is well aware of all the statutory obligations, and it was only when the internal audit team pointed out....

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.... was placed on the judgment of the Apex Court in the case of UOI Vs. Dharmendra Textiles Processors  2008 (231) ELT 3 (S.C). 4. The Ld. Counsel appearing on behalf of the respondent Ms. V. UbhayaBharathi, Advocate reiterated the findings of the Ld. Commissioner (Appeals) and submitted that the tax along with the interest was paid even before issuance of the show cause notice. The fact that the show cause notice sought to appropriate the tax and the interest, as in paragraph 4 of the said notice is sufficient proof for their statement that the above payments were prior to the issuance of show cause notice; that as per Explanation to Section 73(3) of the Act, no penalty under any of the provisions of the Act or Rules shall be impos....

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....g to Section 73 (4) but the same is not applicable to this case and it was not raised in their grounds of appeal. 5. In the instant case the issue is on two aspects viz., non-payment of tax under reverse charge for a sum of Rs. 3,27,266/- for the period February 2009 to March 2012 on their commitment fees paid to the foreign financial institutions and another sum of Rs. 7,78,841/- under Sponsorship service for the period from Jan08 to Mar12. I find that on both the aspects the non-payment was due to their lapse but certainly not on account of suppression of facts. The Respondent have, as a matter of fact, paid the entire service tax due on the two categories mentioned supra along with the interest due and going by the records there is ....

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....ppression is a finding which would presuppose non disclosure and there has been no withholding of information in the instant case. A mere failure to disclose certain facts to the Department would not result in willful suppression of facts as decided by the Hon'ble Supreme Court on various occasions and in particular in the case of Pahwa Chemicals Pvt. Ltd. -Vs- CCE 2005 (189) ELT 257 (SC). It was held by the Hon'ble Supreme Court in the above case that mere failure to declare does not amount to willful mis-declaration or willful suppression. There must be some positive act on the part of the party to establish either willful mis-declaration or willful suppression. All the particulars were culled out only from the respondent's record. It is ....

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....o by the AR, there was suppression of facts which is not present in the case on hand. In Dharmendra Textile Processors case, the issue was when there is suppression of facts and invocation of extended period, whether the payment of the adjudged dues before issuance of show cause notice would absolve the assessee from non-imposition of penalty. The Hon'ble Supreme Court had in those circumstances negated the contention of the assessee holding that, a mere payment of the tax dues before issuance of show cause notice would not absolve the assessee from non-imposition of equal penalty under Section 11AC of the Central Excise Act, 1944. The Madras High Court judgement in the case of Dhandayuthapani Canteen supra was also a case where suppression....