2020 (2) TMI 285 - AT - Service Tax

Non-payment of service - demand alongwith interest and penalty - HELD THAT - The appellant has not set out any ground explaining the reason for non-deposit of the service tax with the Government, even though collected from the customers, in providing the taxable service. Therefore, I do not find any reason to interfere with the orders of the authorities below. Appeal dismissed - decided against appellant.

Summary

Issues: Non-payment of service tax leading to imposition of penalty under Sections 77 & 78 of the Finance Act, 1994.

Analysis:
1. The appellant provided taxable service under 'Works Contract Service' during the period from 2009-10 to September 2011 but failed to pay the service tax amount collected from customers. A show cause notice was issued for recovery of service tax of ?17,92,972/- with interest and penalty.

2. The demand for service tax was confirmed with interest and penalty by the authorities. The appellant, dissatisfied with the penalty imposition, appealed to the Commissioner (Appeals) who upheld the decision. Subsequently, the appellant filed the present appeal before the Tribunal.

3. The Revenue argued that the appellant collected the service tax but did not remit it to the Government. The appellant did not provide any explanation for non-payment despite collecting the tax from customers. Additionally, the appellant did not participate in the hearing before the Commissioner (Appeals).

4. The Tribunal noted that the appellant failed to provide any grounds justifying the non-deposit of service tax to the Government despite collecting it from customers. As a result, the Tribunal found no basis to interfere with the decisions of the lower authorities.

5. Considering the lack of merit in the appeal and the absence of any valid explanation from the appellant regarding the non-payment of service tax, the Tribunal rejected the appeal, upholding the imposition of penalty under Sections 77 & 78 of the Finance Act, 1994.

6. In conclusion, the Tribunal dismissed the appeal due to its lack of merit and upheld the decision of the lower authorities regarding the imposition of penalty for non-payment of service tax despite collection from customers.