2010 (6) TMI 200 - AT - Service Tax

Penalty- Appellant was registered with the department but failed to deposit the service tax in time Held that - the appellant was registered with the department w.e.f. 1998 onwards. The period under dispute is from 2003-2004 to 2007-2008. Learned advocate has not been able to point out any reason for the appellant entertaining the plea for not depositing the Service tax. It is a clear case of suppression of value of the service provided by the appellant and hence establishing mala fide on the part of the appellant penalty upheld

Summary

Issues: Imposition of penalty for non-payment of service tax.

Analysis:
1. The appellant, a registered service tax payer, had deposited a certain amount as security income during a specific period. However, they failed to pay the full service tax amount due, leading to a demand of Rs. 8,86,358/-, as confirmed by the adjudicating authority under Section 73(1)(a) of the Act. The authority also imposed penalties under Sections 76, 77, and 78 of the Act, in addition to ordering the payment of interest under Section 75.

2. The appellant, dissatisfied with the order, appealed to the Commissioner (Appeals), who upheld the decision of the lower authorities. The appellant's representative argued against the penalty imposition, claiming ignorance of service tax intricacies and attributing the default in payment to lack of awareness. However, the Commissioner (Appeals) noted that the appellant had been registered with the department since 1998, and the period in question was from 2003-2004 to 2007-2008. The representative failed to provide any valid reason for the non-payment of service tax, leading to the conclusion of suppression of service value and establishing mala fide intent on the part of the appellant.

3. The appellate tribunal, considering the arguments and findings of the lower authorities, rejected the appeal, affirming the imposition of penalties for non-payment of service tax. The tribunal found no error in the decision to invoke penal clauses against the appellant, given the circumstances of the case and the established facts regarding registration and non-payment history.

This detailed analysis highlights the key points of the judgment, focusing on the imposition of penalties for non-payment of service tax and the appellant's unsuccessful challenge against the penalty decision.