TaxTMI 
TaxTMI 
2016 (8) TMI 548
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....-payment was pointed out in the audit conducted by the department, they had paid the service tax and interest, even before the issuance of show cause notice. Hence, he argues that no penalties are imposable under Section 76 or Section 78 of the Finance Act, 1994 readwith Section 73 (3) and Section 80 of the Finance Act, 1994. He also relied upon the decision of the Hon'ble Karnataka High Court in the case of Commissioner vs. Manipal County [2014 (36) S.T.R. J188 (Kar.)] and the decision of the Tribunal in the case of Arvind Limited vs. Commissioner of Service Tax, Ahmedabad [2010 (19) S.T.R. 752 (Tri.- Ahmd.)]. 3. On the other hand, the Learned Authorised Representative for the Revenue submits that the Audit held by Revenue had found out that the freight charges shown in the Freight Ledger do not tally with the figures shown in the ST-3 Returns filed by them in the year 2005-06, 2006-07 and 2007-08. The service tax payable on such differential amount of freight is demanded in the show cause notice. Therefore, he contends that the appellants had suppressed the facts in the ST-3 Returns filed and hence impositions of penalty under Section 76 as well as Section 78 are appropriate in ....
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....ant Commissioner of Central Excise or, as the case may be, Deputy Commissioner of Central Excise in the course of any proceedings under this Chapter is satisfied that any person has, with intent to evade payment of service tax, suppressed or concealed the value of taxable service or has furnished inaccurate value of such taxable service, he may direct that such person shall pay by way of penalty, in addition to service tax and interest, if any, payable by him, a sum which shall not be less than, but which shall not exceed twice, the amount of service tax sought to be evaded by reason of suppression or concealment of the value of taxable service or the furnishing of inaccurate value of such taxable service: Where any service tax has not been levied or paid or has been short-levied or short-paid or erroneously refunded, by reason of- (a) fraud; or (b) collusion; or (c) wilful mis-statement; or (d) suppression of facts; or (e) Contravention of any of the provisions of this Chapter or of the rules made thereunder with intent to evade payment of service tax, the person, liable to pay such service tax or erroneous refund, as determined under sub-section (2) of S. 73, shall al....
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.... is clear that any person who fails to pay service tax shall be liable to a penalty under the provisions of said section. There are no conditions or ifs and buts in the said Section. Hence, the contention of the appellants that they had not paid the service tax because of a bonafide mistake is not relevant. As regards penalty under Section 78, the same is imposable if service tax is not paid with intend to evade payment of service tax by suppressing or concealing the value of taxable service. We find that in the instant case that the appellant which is a limited company had suppressed the figures of freight charges paid in the ST-3 Returns filed. However, they had shown the correct figures in the ledgers, which was detected by the Central Excise Audit Officers. If, the audit had not detected the same, the service tax would not have been paid and the public exchequer would have been poorer by the said amount. Therefore, we find that penalty is rightly imposed under Section 78 on the appellants. The provisions of Section 73 or Section 80 of the Finance Act by which penalty need not be imposed if the Service Tax is paid before issuance of show cause notice are not applicable when ther....
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....indings would be that the Writ Petitions are liable to be dismissed and we do so. However, we do not make any order as to costs." Further the Hon'ble High Court of Delhi in the case of Bjaj Travels Ltd. Vs. Commissioner of Service Tax (supra) has also examined the Sections 76 and 78 in detail and held as follows:- "15. By their very nature, Sections 76 and 78 of the Act operate in two different fields. In the case of Assistant Commissioner of Central Excise v. Krishna Poduval - (2005) 199 CTR 58 = 2006 (1) S.T.R. 185 (Ker.) the Kerala High Court has categorically held that instances of imposition of penalty under Section 76 and 78 of the Act are distinct and separate under two provisions and even if the offences are committed in the course of same transactions or arise out of the same Act, penalty would be imposable both under Section 76 and 78 of the Act. We are in agreement with the aforesaid rule. 16. No doubt, Section 78 of the Act has been amended by the Finance Act, 2008 and the amendment provides that in case where penalty for suppressing the value of taxable service under Section 78 is imposed, the penalty for failure to pay service tax under Section 76 shall not apply....
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....oner of Central Excise, Nagpur, (supra) has also examined the same issue and held as follows:- "7.8 The next issue is with regard to imposition of penalties under Sections 76, 77 and 78 of the Finance Act, 1994. Penalty under Section 76 is imposable whenever there is a default/delay in payment of service tax. On the occurrence of the default or delay, the provisions are attracted. There is no mens rea required to be proved for imposition of penalty under Section 76 as held by the Hon'ble High Court of Kerala in the case of Krishna Poduval - 2006 (1) S.T.R. 185 (Ker.). Further, the Hon'ble Apex Court in the case of Chairman SEBI v. Shriram Mutual Fund & Another [2006-TIOL-72-SC-SEBI] held that - "In our considered opinion, penalty is attracted as soon as the contravention of the statutory obligation as contemplated by the Act and the Regulation is established and hence the intention of the parties committing such violation becomes wholly irrelevant. A breach of civil obligation which attracts penalty in the nature of fine under the provisions of the Act and the Regulations would immediately attract the levy of penalty irrespective of the fact whether contravention must made by t....