ORDER
T.V. Sairam, Member (T)
1. There are three appeals filed by the Revenue challenging the order of the Commissioner (Appeals) dated 28-5-2004.
2. When the matter was called, none appeared on behalf of the respondents.
3. Ld. JDR, Dr. I. Marianna appeared for the Revenue who states that in the impugned order, the Commissioner (Appeals) has set aside the penalties imposed by the lower authorities under Section 76 of the Finance Act mainly on the ground that in the case of Rashtriya Ispat Nigam Ltd. v. Commissioner of Central Excise, Visakhapatnam , this Tribunal has concluded that in cases where duty was deposited before issue of show-cause notice, no penalty is imposable under Section 11 AC of the Central Excise Act, 1944. The contention of the ld. JDR is that the said decision, is derived from the Central Excise provisions which are distinct from the Finance Act, 1994 as service tax is imposed under the said Act. Moreover, he points out that the construction of the service tax laws clearly incorporate the need and for penalizing the tax payers for their failure under the provisions as specifically contained in Section 76 as well as in Section 77. He urges that, therefore, the ratio adopted by this Tribunal in respect of Central Excise matter cannot be made applicable in service tax matter. He relies on the case law in the case of Trans (India) Shipping Pvt. Ltd. v. Commr. of Central Excise, Chennai-I , wherein it has been held as under:
Service Tax – Penalty – Quantum of – Delay in payment of service tax -Penalty @ Rs. 100/- per day of default being minimum penalty imposable under Section 76 of the Finance Act, 1994, appellants cannot have any grievance against quantum of this penalty – Impugned order upheld.
He also relies on yet another case law in the case of Inma International Security Academy Pvt. Ltd. v. CCE, Chennai , wherein it has been held as follows:
Service Tax – Penalty for delay in payment – Quantum of – Discretion to impose between maximum and minimum is available and same is to be exercised on sound judicial principles and circumstances of the case – In case intent to evade tax is not proved, maximum penalty cannot be imposed -Section 76 of Finance Act, 1994.
4. I have examined the case records and have heard ld. JDR. I tend to agree with the arguments and the ratio applicable in respect of penalties under the provisions of Central Excise law cannot be made applicable under service tax legislation. In view of this, I set aside the order of the Commissioner (Appeals) only in respect of the conclusion reached by him in respect of penalties imposed under Section 76 only. In other words, the penalties imposed in Order-in-Original by the lower authorities under Section 76 is hereby restored. Appeals filed by the Revenue are allowed accordingly.
(Dictated and pronounced in the open Court)