TaxTMI 
TaxTMI 
2026 (2) TMI 528
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.... Finance Act, 1994 read with Section 174 of the CGST Act, 2017 and appropriate amount of Rs. 6,94,438/- already deposited by the appellant against the confirmed demand of Rs, 14,80,387/- vide OIO dated 24.04.2024 and not in relation to the demand of Rs. 7,85,949/- confirmed under this para. (ii) I Confirm the demand of Interest on the above amount of Service Tax Rs. 7,85,949/- under Section 75 of the Finance Act, 1994 read with section 174 of the CGST Act, 2017. (iii) I Impose a Penalty of Rs. 7,85,949/- upon the appellant under Section 78 of the Finance Act 1994 read with section 174 of the CGST Act, 2017 for suppression of various facts and contravention of various provisions of the Finance Act, 1994 (iv) I impose the Penalty of Rs. 10,000/- under Section 77(1)(c) and penalty/late fee of Rs. 20,000/- for each return for FY 2015-16 under Section 70 of the Finance Act 1994 read with section 174 of the CGST Act, 2017. The instant appeal bearing no. 57-ST/APPL-MRT/GZB/2024-25 dated 03.07.2024 been filed by M/s A S Advertising & Marketing P. Ltd., B-224, Shalimar Garden, Ghaziabad, U.P.- 201005 is herby disposed off on the above terms. 2.1 ....
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....irm the demand of interest, at the appropriate rate, on the aforesaid (sl. No. I i.e. Rs.14,80,3837/- confirmed amount of demand of service tax, under the provisions of Section 75 of the Finance Act, 1994; (iii) I impose a penalty of Rs.14,80,387/- (Inc1. Cesses) (Rupees Fourteen Lakh Eighty Thousand Three Hundred Eighty Seven only), upon the said party under the provisions of Section 78(1) of the Finance Act, 1994. If the party opts to deposit the amount of service tax along with appropriate interest & penalty within 30 days of receipt of this order so confirmed, the penalty is reduced to 25% of the amount of service tax in terms of second and third proviso of section 78(1) of Finance Act, 1994 as amended: (iv) I impose penalty of Rs.10,000/-only (Rupees Ten Thousand only] as imposable under section 77(1) of the Finance Act, 1994; (v) I impose penalty of Rs.20,000/-only (Rupees Twenty Thousand only] as imposable under section 70(1) of the Finance Act, 1994; All the adjudged dues should be paid forthwith 2.6 Aggrieved the appellant filed an appeal before the Commissioner, CGST(Appeals), Meerut, who vide Order-InAppeal No. NOI- EXCUS-002-AAPL-5....
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....before the adjudicating authority when the case is posed for personal hearing." 2.7 The Show Cause Notice dated 19.04.2021 was again adjudicated in the de-novo proceedings vide Order-in-Original 06/AC/CGST/D-IV/GZB/2024-25 dated 24.04.2024 holding as follows: (i) I confirm the demand and recovery of the service tax for Rs,14,80,387/- (Rupees fourteen lakh Eighty thousand three hundred Nine Hundred Forty Nine Only) from the party in terms of the proviso to Section 73 (1) of the Finance Act, 1994 read with Section 174 of the CGST Act, 2017 and appropriate the Service Tax Rs.6,94,438/- and rest of the amount is recoverable. (ii) I also demand and confirm the recovery of interest at appropriate rate on the amount of Service Tax confirmed at S.No.(i) above under Section 75 of the said Act ibid read with Section 174 of CGST Act, 2017. (iii) I impose a penalty of Rs.7,85,949/- on the party under Section 78 of Act read with Section 174 of the CGST Act, 2017. Further, I give the option to the party that this penalty would stand reduced to twenty five percent in terms of second proviso to Section 78(1) of the Act, if the reduced penalty too is deposited along wi....
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....submitted under the instant appeal by the appellant by which adjustment of service tax payable through cenvat credit cannot be verified. Thus, I hold that the contention of the appellant regarding payment of tax during the relevant period is not sustainable. 6.7 As per para 3.7 of the impugned order, the adjudicating authority has recorded his findings as "merely submission of the invoices does not prove their claim regarding the cenvat credit. As per the Cenvat Credit Rules, 2004 and Service Tax Rules, 1994, a service provider is allowed to take cenvat credit of duty paid on inputs, input services and capital goods received for providing output services. Further. Rule 3(4) of the CCR, 2004, stated that cenvat credit shall be utilized only to the extent such credit is available on the last day of the month for payment of tax relating to that month. But as the party has not shown any book of accounts in respect of cenvat credit utilization and not shown in the cenvat credit column of the service tax return, the claim of the party is not tenable". In view of the said findings of the adjudicating authority and the findings of the appellate authority recorded in the OIA dated ....
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....e on their own accord, as accentuated from the fact that the appellant had wilfully and deliberatively not declared the same in their statutory returns. Thus, I find that the ingredients to invoke the extended period of time limitation to raise the subject demand was intrinsically inherent in the facts of the subject case and consequently the penal provisions under Section 78 of the Finance Act, 1994 are automatically attracted. Further, I find that once it is established that ingredients to attract operation of Section 78 of the Finance Act, 1994 are present in a case, the discretion to quantify the amount of penalty ends. Accordingly equivalent penalty under Section 78 of the Finance Act, 1994 have rightly been imposed upon the appellant. As regarding imposition of penalty upon the appellant under the provisions of Section 78 of the Finance Act, 1994, I find that the foregoing findings unambiguously establishes the same, however, corroboratedly reliance is placed upon the pronouncement made in the followina cases: (i) Inox Leisure Limited Vs Commissioner of Service Tax, Mumbai [2016 (42)STR 497 (Trib-Mumbai)] :: Held :: ...... (ii) Cairn Energy India Pyt. Ltd. V....
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....ereon under section 75 shall stand modified accordingly, and after taking into account the amount of service tax so modified he person who is liable to pay such amount of service tax, shall also be liable to pay the amount of penalty and interest so modified." 4.3 Order in original records the findings as follows: 3.4. I also seen the challans and find that the actual Service tax paid through the challan is as under: Month Challan Number & Date Amount Apr-15 30533 dated 07.05.2015 46813 May-15 30053 dated 07.06.2015 52740 Jun-15 37450 dated 04.07.2015 54880 Jul-15 30421 dated 08.08.2015 51968 Aug-15 32363 dated 04.09.2015 59602 Sep-I5 36385 dated 05.10.2015 54065 Oct-15 36985 dated 06.11.2015 59278 Nov-15 30372 dated 07.12.2015 67785 Dec-15 30013 dated 05.01.2016 73316 Jan-16 31807 dated 05.02.2016 45000 Feb-16 30081 dated 07.02.2016 81469 Mar-16 30432 dated 21.03.2016 1665 Apr-16 30018 dated 05.04.2016 2828 May-16 31960 dated 22.04.2016 43029 Total 694438 3.5. I find that the above challans are verified from the....
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....why they disagree with the claim of the appellant that the remaining amount was paid by him by debit in CENVAT account. Both the authorities are silent in respect of the admissibility of the said CENVAT Credit, but have observed that because the appellant has failed to file ST-3 returns showing the CENVAT credit taken and the debit entries from the said account the claim made by the appellant is unsubstantiated. 4.6 I observe that appellant has submitted the service tax ledger for the year 2015-16 clearly showing the details of the services provided and services received and the details of payment of service tax, both from the credit account and through GAR-7. The service tax ledger clearly shows that the appellant have themselves assessed the service tax liability during the Financial Year 2015-16 as Rs 14,25,187.01/- and have paid the said service tax according to the self assessment made by them. 4.7 I find that it is fact on record that appellant had failed to file the ST-3 returns detailing their service tax liability and payment thereof at the prescribed intervals. However in the event when the appellant was regularly and monthly assessing his tax liability and paying t....
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....ideration the nature of the penalty, which is punitive, no sentence can be imposed under that provision unless the element of mens rea is established. In most cases of criminal liability, the intention of the Legislature is that the penalty should serve as a deterrent. The creation of an offence by Statute proceeds on the assumption that society suffers injury by and the act or omission of the defaulter and that a deterrent must be imposed to discourage the repetition of the offence. In the case of a proceeding under Section 271(1)(a), however, it seems that the intention of the legislature is to emphasise the fact of loss of Revenue and to provide a remedy for such loss, although no doubt an element of coercion is present in the penalty. In this connection the terms in which the penalty falls to be measured is significant. Unless there is something in the language of the statute indicating the need to establish the element of mens rea it is generally sufficient to prove that a default in complying with the statute has occurred. In our opinion, there is nothing in Section 271(1)(a) which requires that mens rea must be proved before penalty can be levied under that provision. We are....