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2009 (7) TMI 253 - AT - Service TaxCommissioner (Appeals) in the impugned order (by taking into consideration the provisions of Section 11AC of Central Excise Act.) after relying upon the decision of the Hon ble Supreme Court in the case of Dharamendra Textile Processors & Others reported in 2008 - TMI - 31520 - SUPREME COURT held that the appellants are liable to pay penalty equal to the amount of tax - In this case, the demand is in respect of Service Tax. The Commissioner (Appeals) in the impugned order has not taken into consideration the penal provisions of S. Tax read with Section 80 of Finance Act. As the relevant provisions of Finance Act was not taken into consideration, the impugned order is set aside
Issues: Waiver of pre-deposit of penalty in a Service Tax case.
Analysis: The appellant filed an application for the waiver of pre-deposit of penalty in a Service Tax case. The demand for Service Tax was confirmed, and the appellant had already paid the tax along with interest. The Commissioner (Appeals) held that the appellants are liable to pay a penalty equal to the amount of tax, relying on a decision of the Hon'ble Supreme Court. The appellant argued that under Section 80 of the Finance Act, if the assessee shows bona fide for not paying the tax, penalties can be waived. The Commissioner (Appeals) considered the provisions of Section 11AC of the Central Excise Act while deciding the appeal, which the appellant contended was not relevant to the case. The Ld. JDR supported the order in appeal, stating that there is no discretion to impose a lesser amount of penalty based on Supreme Court decisions. The Tribunal observed that the demand was related to Service Tax, and the Commissioner (Appeals) did not consider the penal provisions of Service Tax along with Section 80 of the Finance Act in the impugned order. As a result, the Tribunal set aside the impugned order, waived the requirement of pre-deposit of penalty, and remanded the matter back to the Commissioner (Appeals) for a fresh decision after giving the appellant an opportunity for a hearing. The appeal was disposed of by way of remand.
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