2009 (4) TMI 779 - AT - Service Tax

Summary

Issues:
1. Application for waiver of pre-deposit of penalty amount imposed under Section 76 of the Finance Act, 1994.
2. Dismissal of appeal by Commissioner (Appeals) due to the mismatch in penalty sections imposed.
3. Confirmation of Service Tax demand and imposition of penalty under Section 76 of the Finance Act by the adjudicating authority.
4. Requirement for reconsideration by the Commissioner (Appeals) and remand of the matter for fresh decision.

Analysis:
1. The appellants filed an application seeking waiver of the pre-deposit of the penalty amount imposed under Section 76 of the Finance Act, 1994. It was noted that the appellants had already paid a significant sum along with interest before the issuance of the show cause notice. The Tribunal considered the circumstances and decided to waive the pre-deposit of penalty, as the issue involved in the appeal was related to a penalty under a different section than the one imposed by the adjudicating authority.

2. The Commissioner (Appeals) had dismissed the appeal filed by the appellants on the grounds that the issue raised was regarding a penalty under Section 11AC of the Central Excise Act, 1944, while the penalty was actually imposed under Section 76 of the Finance Act, 1994. This mismatch in penalty sections led to the dismissal of the appeal. The Tribunal recognized this discrepancy and decided that the matter required reconsideration by the Commissioner (Appeals) to ensure a fair decision.

3. Furthermore, the Tribunal noted that the demand for Service Tax along with interest was confirmed, and the penalty under Section 76 of the Finance Act was imposed by the adjudicating authority. Due to the confusion regarding the penalty sections and the necessity for a proper review, the Tribunal set aside the impugned order and remanded the matter to the Commissioner (Appeals) for a fresh decision after providing the appellants with an opportunity to be heard. This disposal of the appeal was done by way of remand to rectify the procedural discrepancies and ensure a just outcome.

In conclusion, the Tribunal granted the waiver of pre-deposit of penalty, highlighted the need for a reconsideration of the appeal by the Commissioner (Appeals) due to the penalty section mismatch, and remanded the matter for a fresh decision to address the issues effectively and afford the appellants a fair opportunity to present their case.