2018 (4) TMI 1767 - HC - Service Tax

Levy of service tax - Outdoor Catering services - imposition of penalty as well - HELD THAT - The learned Tribunal has not committed any legal error in passing the impugned order - The view of the learned Tribunal has been affirmed by the Allahabad High Court in the case of M/S. INDIAN COFFEE WORKERS' CO-OPERATIVE SOCIETY LIMITED VERSUS COMMISSIONER OF CENTRAL EXCISE SERVICE TAX, ALLAHABAD 2014 (4) TMI 407 - ALLAHABAD HIGH COURT , therefore, in view of the fact that the issue involved in the matter on levy of service tax has been settled by the Allahabad High Court, thus, no substantial question of law is arising in this appeal. Appeal dismissed.

Summary

Issues:
Challenge to imposition of service tax on outdoor catering service; Levy of penalty under sections 76 and 78 of Finance Act, 1994; Judicial discipline and confirmation of tax demand based on similar facts; Interpretation difficulty and waiver of penalty.

Analysis:
The case involved an appeal under Section 35G of the Central Excise Act, 1944 against an order passed by the Customs Excise and Service Tax Appellate Tribunal, New Delhi, affirming the levy of service tax on outdoor catering service. The appellant contested the imposition of service tax and argued on the levy of penalty, citing confusion as the reason for non-deposit of the levy in time. The Tribunal waived the penalty under sections 76 and 78 of the Finance Act, 1994, considering the circumstances presented by the appellant.

The Tribunal referred to a previous order involving the same appellant where the liability to service tax was confirmed, and based on this precedent, confirmed the tax demand in the current case. The Tribunal highlighted the absence of peculiar facts and circumstances, leading to the confirmation of the tax demand and the subsequent application of interest. Due to interpretation difficulty, the Tribunal decided not to impose a penalty, following judicial discipline and considering the overall assessment of the case.

The Tribunal's decision was supported by a judgment of the Allahabad High Court in a similar case, indicating that the issue of levy of service tax had been settled by the higher court. Consequently, the Tribunal found no substantial question of law arising in the appeal, leading to the dismissal of the appeal for lack of merit. The Tribunal concluded that there was no legal error in its order, as it followed established legal principles and precedents, ultimately upholding the levy of service tax on the outdoor catering service and the waiver of penalty in the case.