2009 (9) TMI 553 - AT - Service Tax

Penalty - the appellant is a small time cable network operator and was facing severe financial crisis and therefore, there has been default in payment of service tax. Further, during that time, there was dispute relating to taxability of the impugned service. The entire amount of service tax and interest stands paid before issue of show cause notice. He seeks waiver of penalty under Section 80 of the Finance Act, 1994. held that- no evidence of suppression or mis-management relied on. Leniency warranted. Separate penalty under section 78 not required. Penalty under section 76 reduced.

Summary

The appellate tribunal, CESTAT, New Delhi, heard an appeal against the order of the Commissioner (Appeals) demanding service tax, interest, and penalties. The appellant, a cable network operator, acknowledged the service tax liability but sought waiver of penalties under Section 80 of the Finance Act, 1994, due to financial crisis and a dispute over taxability. The Departmental Representative argued against the waiver, citing the appellant's registration for service tax payment in 2003. The tribunal found no justification for non-payment of service tax from October 2004 to December 2004 but acknowledged the financial difficulties faced by the appellant. Considering the circumstances, the tribunal reduced the penalty imposed under Section 76 and eliminated the separate penalty under Section 78. The penalty under Section 77 was left unchanged, and the appeal was disposed of accordingly.