2017 (2) TMI 317 - AT - Service Tax

Waiver of penalty imposed u/s 78 of the FA, 1994 - invocation of Section 80 after it has been omitted form the statute - reliance placed by Revenue in the decision of the Apex Court in the case of Kolhapur Canesugar Works Ltd. v. UOI 2000 (2) TMI 823 - Supreme Court of India to state that the Commissioner had no power to invoke Section 80 after the same has been omitted from the statute - Held that - the Tribunal has been consistently invoking the Section 80 after the same has been omitted from the statute. The decision cited by Revenue is in respect of omission of Rule and not omission of Section from the Finance Act. In fact, the decision of the Apex Court is based on the very distinction. Since it not the case of omission of a rule but that of a Section, the entire premise of appeal does not survive - appeal dismissed - decided against Revenue.

Summary

Issues:
Appeal against order invoking Section 80 for waiver of penalty under Section 78 of the Finance Act, 1994.

Analysis:
The appeal was filed by the Commissioner of Service tax challenging the order of Commissioner (Appeals) regarding the invocation of Section 80 for penalty waiver under Section 78 of the Finance Act, 1994. The appellant argued that Section 80 was revoked in May 2015, and thus, the Commissioner had no power to invoke it in December 2015. The appellant relied on the decision of the Apex Court in a specific case to support this argument. The Tribunal noted that the appellant's argument was based on the omission of a Section, not a Rule, from the statute. The Tribunal highlighted the distinction between the repeal of a Rule and the repeal of a Section, emphasizing that the decision of the Apex Court was in the context of the former. The Tribunal referred to Section 6 of the Rules to explain the effect of repeal, emphasizing that the repeal of a provision without a saving clause would impact pending proceedings.

The Tribunal further elaborated on the observations of the Hon'ble Apex Court regarding the repeal or deletion of a provision from a statute. The Court's analysis highlighted that the operation of repeal or deletion depends on the presence of saving provisions for pending proceedings. In the absence of such provisions, actions must cease where the omission finds them, and no relief can be granted post-omission. The Tribunal emphasized that the case in question did not fall under the purview of Section 6 of the General Clauses Act, as there was no saving provision for pending proceedings. The Tribunal concluded that since it was not a case of omission of a rule but of a Section, the basis of the appeal did not hold. Consequently, the Tribunal dismissed the Revenue's appeal as it did not survive in light of the above analysis.

In summary, the Tribunal's judgment focused on the interpretation of the applicability of Section 80 for penalty waiver under the Finance Act, 1994, post its revocation. The Tribunal analyzed the legal principles surrounding the repeal or deletion of provisions from a statute, emphasizing the significance of saving clauses for pending proceedings. The decision underscored the distinction between the repeal of a Rule and a Section, ultimately leading to the dismissal of the Revenue's appeal.