2007 (3) TMI 763 - AT - Service Tax

Summary

Issues involved: Applicability of penalty under Service tax laws and interpretation of the Extra Ordinary Tax Payer Friendly Scheme.

Summary:

Issue 1: Applicability of penalty under Service tax laws
The appellant, engaged in providing "Business Auxiliary Services," failed to pay tax for a specific period but later deposited the tax along with interest upon detection by Revenue. Subsequently, penalty was imposed, leading to the initiation of proceedings.

Issue 2: Interpretation of the Extra Ordinary Tax Payer Friendly Scheme
The appellant invoked the Extra Ordinary Tax Payer Friendly Scheme, which stated that no penalty would be levied if tax and penalty interest were paid before a specified date. However, the benefit of the scheme was denied to the appellant on the basis that the tax was deposited before the scheme's announcement.

In reference to the case of CCE Bhopal v. Bharat Security Services & Workers Cont., the Tribunal held that the scheme's provisions should apply to all assessees. As the appellant had deposited the duty and interest before the scheme's deadline, it was determined that no penalty should be imposed. Consequently, the penalty was set aside, and the appeal was allowed with consequential relief to the appellant.

The stay petition was also disposed of in the same judgment.