2007 (9) TMI 45 - AT - Service Tax

Appellant contended that the penalties are set aside by the Commissioner(A) in the appeal filed by him and that order has not been challenged by the revenue, therefore, the order of enhancement of penalty in the revision order by the commissioner is not sustainable

Summary

Issues Involved:
Appeal against enhanced penalties imposed under Service Tax by the Commissioner of Central Excise.

Detailed Analysis:

Issue 1: Appeal against imposition of penalties
The appellant filed appeals against the impugned orders where penalties were enhanced by the Commissioner of Central Excise. Show cause notices were issued to the appellant, raising demands of Service tax and penalties. The adjudicating authority confirmed the demand and imposed penalties. The Commissioner (Appeals) upheld the amount of Service Tax but set aside the penalty, considering the appellant's bona fide belief. The appellant then appealed before the Tribunal, which dismissed the appeal.

Issue 2: Review and enhancement of penalties
Subsequently, the Commissioner of Central Excise reviewed the order and enhanced the penalties. The appellant contended that since the penalties were set aside by the Commissioner (Appeals) and not challenged by the Revenue, there should be no enhancement. However, the Revenue argued that the Commissioner has the authority to enhance the amount of Service Tax or penalty as per the provisions of the Finance Act.

Issue 3: Sustainability of penalty enhancement
The Tribunal noted that the adjudication orders were challenged by the appellant, and the Commissioner (Appeals) upheld the demand of Service Tax but set aside the penalties. Since no appeal was filed by the Revenue against this order, the Tribunal found the order for enhancing the penalty not sustainable. As the original order imposing penalty was already set aside, the Tribunal held that the present order revising the penalties was not sustainable. Consequently, the Tribunal set aside the order enhancing the penalties and allowed the appeals.

This comprehensive analysis highlights the legal journey of the case, focusing on the appeal against penalties, review, and enhancement of penalties, and the sustainability of penalty enhancement in the absence of an appeal by the Revenue.