2005 (7) TMI 595 - AT - Central Excise

Summary

Issues Involved: Imposition of personal penalty for late payment of service tax by an advertising agency.

Summary:

Issue 1: Imposition of Personal Penalty
The appellant, an advertising agency, faced proceedings for late payment of service tax between May 1997 to September 1999. The Assistant Commissioner imposed a penalty of Rs. 2.64,400/- at the rate of Rs. 100/- per day for delays ranging from 2 to 276 days. The Commissioner (Appeals) upheld this decision, leading to the current appeal.

Details:
The appellant argued that the delays were due to financial difficulties and non-payment by customers, citing Section 80 of the Finance Act, 1994, as providing genuine reasons for the delays. However, the JDR contended that the appellant had a history of repeated delays in tax payment, making them a habitual offender. The Tribunal noted that the appellant registered in November 1996 and was aware of their tax obligations. The Tribunal found that the delays occurred almost every month, totaling a late service tax deposit of approximately Rs. 1,36,00,000/-. The penalty of Rs. 2.66 lakhs was deemed appropriate and not excessive, leading to the rejection of the appeal.

Conclusion:
The Tribunal upheld the imposition of the penalty on the advertising agency for late payment of service tax, considering the history of delays and the substantial amount involved.