TaxTMI 
TaxTMI 
TaxTMI 
2012 (10) TMI 1284
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....authority for allowing excess paid adjustment against the short payment and quantify the balance duty along with interest even though M/s BSNL is not entitled for the same? (2) Whether CESTAT is right in waiving the Penalty under Section 78 of the Finance Act 1994, simply on the ground that M/s BSNL is a Public Sector Undertaking, though malafide intention is not necessary Prerequisite for imposing Penalty? (3) Whether any amount collected from customers by assessee, as a service tax liable to be deposited to government? 2. The respondent M/s Bharat Sanchar Nigam Ltd. (BSNL), is engaged in the business of providing telephone services as defined under section 65 of the Finance Act, 1994 (hereinafter referred to as "the Act"). It appe....
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....ervice tax was paid and returns were filed on the basis of the Cash Account Current figures. 2.2 The above accounting method followed by the assessee led to its paying the Service Tax on the basis of an estimated amount in view of the fact that the full details of actual amounts received were not available before the due date and because of this in some months, there was excess payments made and in some months, there were short payments. The assessee adjusted both the amounts and paid the differential amount. 2.3 In view of the above facts, a show-cause notice dated 18th October, 2006 came to be issued to the assessee alleging short payment of service tax on the ground that on reconciliation of the Cash Account Current and the Sub Ledger ....
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.... duty alongwith interest. Insofar as the levy of penalty under section 78 is concerned, the Tribunal was of the view that in the light of the above facts as well as in view of the fact that the assessee was a public sector undertaking of Government of India, it could not be attributed with the malafide intention of evading payment of duty, and accordingly set aside the penalty. 3. Mr. Y.N. Ravani, learned counsel for the appellant submitted that the approach adopted by the Tribunal is erroneous inasmuch as merely because the assessee is a public sector undertaking under the Government of India, it cannot be said that no malafide intention can be attributed to it as regards intent to evade payment of duty. Under the circumstances, the Tribu....
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....rpose reads as under:- 78. 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 section 73, shall also be liable to pay a penalty, in addition to such service tax and interest thereon, if any, payable by him, which shall not be less than, but which shall not exceed twice, the amount of service tax so not levied or paid or sh....
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...., found that no malafide intention could be attributed to the assessee. In addition, the fact that the assessee was a public sector undertaking of the Government of India was an additional factor which was taken into consideration by the Tribunal for the purpose of holding that malafide intention to evade payment of duty could not be attributed to it. The contention that it is solely on the basis of the fact that the assessee was a public sector undertaking that the Tribunal deleted the penalty under section 78 of the Act, therefore, does not merit acceptance. 8. Another aspect of the case is that the failure to pay the requisite amount of service tax during some months had been duly explained by the assessee, namely that in view of the ac....