2009 (7) TMI 82 - AT - Service Tax

Rectification of mistake - from the reply to the notice dated 1.7.04 which was received in the Central Excise Division on 28.7.04, it was clearly mentioned in one place that the tax amount has been paid on 6.11.03. whereas in another place 6.11.04 is mentioned. The errors in the reply by the assessee got repeated in the order of the original authority and that of the Commissioner. Since in the reply received on 28.7.04, the date of payment is mentioned as 6.11.04 and 6.11.03, the former is clearly a clerical mistake. The delay involved is only 12 days and not one year plus 12 days. Accordingly, the penalty of Rs.37800/- imposed under Section 76 is reduced to Rs.1200/- taking the number of days of delay as 12 days. It is rather unfortunate that the assessee has to come before the Tribunal for the second time to get this relief.

Summary

Issues: Dispute over service tax liability and penalty calculation based on delay in payment.

In this case, the appellant challenged an order passed by the Commissioner regarding the delay in payment of service tax. The appellant contended that the delay was only 12 days, resulting in a penalty of Rs. 1200, contrary to the imposed penalty of Rs. 37800 for a delay of one year and 12 days. The original authority had dropped penalty proceedings after the service tax payment and return filing. However, discrepancies in dates led to subsequent penalties. The Tribunal remanded the matter for rectification, but the Commissioner insisted on appeal as the remedy. The Tribunal found clerical errors in the dates mentioned in the reply and reduced the penalty to Rs. 1200, acknowledging the delay as only 12 days. The Tribunal expressed disappointment at the need for the appellant to approach twice for relief, ultimately disposing of the appeal accordingly.

The issues involved in this judgment revolve around the dispute regarding the calculation of service tax liability and penalty based on the delay in payment. The appellant argued for a reduced penalty of Rs. 1200, contending that the delay was only 12 days, contrary to the imposed penalty of Rs. 37800 for a delay of one year and 12 days. The Tribunal, after considering the records and discrepancies in dates, found that the delay was indeed only 12 days and rectified the penalty amount accordingly. The Commissioner's insistence on appeal as the remedy despite the clerical errors in dates further complicated the matter, leading to the appellant approaching the Tribunal twice for resolution. Ultimately, the Tribunal expressed disappointment at the situation and disposed of the appeal by reducing the penalty to Rs. 1200 based on the corrected number of days of delay.