TaxTMI 
TaxTMI 
2016 (8) TMI 1123
X X X X Extracts X X X X
X X X X Extracts X X X X
.... under sections 76 and 78 of Finance Act, 1994. The assessee, M/s Shlok Media Pvt Ltd, registered as provider of 'advertising agency' service from June 2002 paid service tax and filed returns till March 2006. It was alleged that they, despite collecting tax from their customers for the period from April 2006 to April 2007, did not discharge their obligations to pay tax and file the returns thereafter. 2. Before the original authority, M/s Shlok Media Pvt Ltd submitted that they had been regular in paying service tax on the basis of billings till March 2006 and thereafter on receipt basis. It was claimed that some of their clients had defaulted on payments leading to financial crisis which prevented them from discharging their....
X X X X Extracts X X X X
X X X X Extracts X X X X
....tral Excise, Madurai [2008 (10) STR 598 (Tri-Chennai)], Commissioner of Central Excise, Ludhiana v. Azad Publications [2004 (167) ELT 59 (Tri.-Delhi.) and Rex Advertisers v. Commissioner of Service Tax [2006 (2) STR 330 (Tri.-Bang.)]. 5. On the appeal of Revenue, Learned Authorised Representative cited the decision of the Hon'ble Supreme Court in Union of India v. Dharmendra Textile Processors [2008 (231) ELT 3 (SC) which held that mandatory penalty in tax statutes cannot be diluted for any reason whatsoever. 6. It is seen that the appellant-assessee claims that they are in the business of display of advertising and hoarding and leasing of hoardings and therefore are not liable tax prior to 1st May 2006 when section 65(105)(zzzm) to....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... has been their breach of obligation to deposit the tax collected. 8. We do not find any reason to disbelieve their claim of inability to pay tax owing to lack of funds. Such possibilities can and do occur in the world of business. That, however, does not confer immunity from being proceeded against for failure to comply with tax obligations. There is also no doubt that there is an obligation cast upon every service provider to collect the tax due through the service recipient and deposit the amount with the exchequer. However, the law does contemplate and is not averse to use of the tax so collected within the business till the stipulated date for payment. That this period was unilaterally extended by the assessee is not in di....