2014 (1) TMI 1415 - AT - Service Tax

Condonation of delay - Delay due to sole proprietorship - Held that - in the case of proprietary firm, it is a one man show, and there can be failure in undertaking the requirements as per law. In view of the peculiar circumstances of the case such as the penalty was imposed on the appellant on an appeal filed by the Revenue and the appellant is a heart patient, medical certificate was submitted that he was not well, and the nature of the business in which the appellant is involved, I consider that in this case, a lenient view is called for and accordingly the delay is required to be condoned - Delay condoned.

Summary

Issues: Condonation of delay in filing appeal, waiver of pre-deposit of penalty

In the judgment delivered by the Appellate Tribunal CESTAT AHMEDABAD, the appellant sought condonation of a 9-month delay in filing an appeal. The delay was attributed to the proprietor's illness, who managed the business single-handedly. The appellant, a proprietary concern, had paid the Service Tax liability and penalties but was unaware of additional penalties. The appellant's representative argued that the delay was due to the proprietor's sickness and lack of understanding of the consequences of the Order-in-Appeal. The respondent contended that the reasons provided were insufficient for condonation. The Tribunal acknowledged the challenges faced by a one-man show proprietary firm, especially when the penalty was imposed by the Revenue and considering the proprietor's health condition. The Tribunal, therefore, granted condonation of the delay, taking a lenient view due to the unique circumstances.

Regarding the Stay Petition, since the Service Tax and penalties under Sections 77 and 78 were already paid, the Tribunal deemed it appropriate to waive the pre-deposit of the penalty imposed under Section 76 of the Finance Act, 1994. Consequently, the requirement of pre-deposit was waived, and a stay against the recovery of the penalty was granted during the pendency of the appeal. The judgment highlighted the importance of considering individual circumstances, such as health issues and the nature of the business, in determining the appropriate course of action in legal matters.