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TMI Blog2010 (10) TMI 281X X X X Extracts X X X X X X X X Extracts X X X X ..... Coop Sugar Mills Colony by the Jurisdictional Central Excise officers, the department came to know that the appellant had been providing the service of repair and maintenance to M/s. Nawanshahr Coop Sugar Mills Colony. Since, the repair and maintenance service became taxable w.e.f. 1-7-03 and since it was found that the appellant had not taken any registration for service tax, the department conducted inquiry with the appellant and it was found that during the period from 16-6-2005 to 31-3-2007 the appellant had provided the services of repair and maintenance to M/s. Nawanshahr Coop Sugar Mills Colony and had received an amount of Rs. 56,75,690/- on which the service tax chargeable was Rs. 5,90,015/-. Accordingly, a show cause notice was i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ground that the appellant being illiterate was not aware of his service tax liability and thus non-payment of service tax was due to genuine reasons. But this plea was not accepted by the Commissioner (Appeals). Against the above order of the Commissioner (Appeals), the present appeal have been filed by the appellant challenging the imposition of penalty under Section 76 and 78. The service tax demand has not been challenged. 2. Heard both the sides. 2.1 Shri Vikrant Kakria, Advocate, the learned Counsel for the appellant, pleaded that the appellant is an illiterate person who was not aware that his activity attracted service tax, that w.e.f. 1-7-03, the service of repair and maintenance under Annual Maintenance Contract only was ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... held by Commissioner (Appeals) had been paid prior to the issue of show cause notice, in any case, in accordance with the judgment of Hon'ble Delhi High Court in the case of K.P. Pouches (P) Ltd. v. Union of India reported in 2008 (228) E.L.T. 31 (Del.) penalty of only 25% of the service tax demand should be imposed in terms the proviso to Section 78(1). 2.2 Shri R.K. Gupta, the learned Departmental Representative, defended the impugned order by reiterating the Commissioner (Appeals)'s finding and pleaded that in this case, though the service tax on repair and maintenance service was introduced w.e.f., 1-7-03, the service tax registration was never been obtained by the appellant and as such no information had been given at any point o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e show cause notice. 3. I have carefully considered the submissions from both the sides and perused the records. 4. There is no dispute about the fact that for the period from 16-6-05 to 31-3-07, the appellant was liable to pay service tax in respect of the repair and maintenance service being provided by him. But neither the service tax was paid nor at any point of time, the appellant obtained service tax registration. In fact, the appellant in this case has not challenged his service tax liability. The appeal is only on the question of imposition of penalty under Section 76 and 78. 5. First plea of the appellant is that he is eligible for waiver of penalty in view of the provision of Section 80. As per the provisions of Secti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 76 as well as 78 is imposable and following the judgment of Hon'ble Kerala High Court, same view has been taken by the Division Benches order in the case of Bajaj Travels Ltd. v. CCE, Chandigarh (supra). In view of this, the appellant's plea that simultaneous penalty cannot be imposed under Section 76 and 78 is not acceptable. 7. The appellant has pleaded that since the service tax liability upheld by the Commissioner (Appeals) is only w.e.f. 16-6-05 and the service tax liability for the period from 16-6-05 to 31-3-07 has already been discharged by him in March 2008 itself i.e. prior to the issue of show cause notice as at that time he had paid an amount of Rs. 3,98,336/- as against service tax liability of Rs. 3,20,467/-, in accorda ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ant's plea for setting aside the penalty as per the provisions of Section 80 of the Finance Act, as well as his plea that simultaneous penalty under Section 76 and 78 cannot be imposed is not accepted and the impugned order on these points is upheld, the matter is remanded to the Commissioner (Appeals) for deciding the question of reduced penalty under first proviso to Section 78 of the Finance Act, in accordance with the ratio of Hon'ble Delhi High Court judgment in the case of K.P. Pouches (P) Ltd. v. UOI (supra) after ascertaining as to whether the appellant had discharged their entire tax liability alongwith interest prior to the issue of show cause notice. The appeal is disposed of in these terms. (Dictated and pronounced in open cour ..... X X X X Extracts X X X X X X X X Extracts X X X X
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