2019 (11) TMI 785 - AT - Service Tax

Imposition of simultaneous penalty u/s 76 78 - HELD THAT - This issue has been settled by the Hon ble High Court of Gujarat in the case of M/S RAVAL TRADING COMPANY VERSUS COMMISSIONER OF SERVICE TAX 2016 (2) TMI 172 - GUJARAT HIGH COURT according to which when the penalty under section 78 was imposed, no penalty should be imposed under section 76. Considering the aforesaid judgment, we are of the view that Adjudicating Authority has rightly not imposed penalty under section 76. Appeal dismissed - decided against Revenue.

Summary

Issues:
1. Imposition of penalty under sections 76 & 78 simultaneously.

Analysis:
The appeal before the Appellate Tribunal CESTAT Ahmedabad involved the issue of whether penalties under sections 76 & 78 can be imposed simultaneously. The Revenue filed an appeal seeking the imposition of penalties under both sections, but the Adjudicating Authority had only imposed a penalty under section 78, omitting the penalty under section 76 as initially proposed in the Show Cause Notice. The key question for determination was whether both penalties could be levied concurrently.

During the proceedings, the Ld. Jt. Commissioner (AR) representing the Revenue reiterated the grounds of appeal, while no representation was made on behalf of the respondent. The Tribunal, comprising HON'BLE MEMBER (JUDICIAL) and HON'BLE MEMBER (TECHNICAL), delved into the crux of the matter. They referred to a precedent set by the Hon'ble High Court of Gujarat in the case of Raval Trading Company, which established that when a penalty under section 78 is imposed, no penalty should be levied under section 76. Relying on this legal precedent, the Tribunal concluded that the Adjudicating Authority had correctly refrained from imposing a penalty under section 76 in the present case. Consequently, the Tribunal found no flaws in the impugned order and upheld it, ultimately dismissing the Revenue's appeal.

In essence, the judgment clarified the legal position regarding the imposition of penalties under sections 76 & 78 simultaneously. The decision was anchored in the established legal principle derived from the precedent set by the Hon'ble High Court of Gujarat, providing a clear guideline for future cases involving similar issues. The Tribunal's adherence to this legal precedent ensured consistency and adherence to established legal principles in resolving the matter at hand.