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TMI Blog2013 (8) TMI 414X X X X Extracts X X X X X X X X Extracts X X X X ..... he quantum of penalty to be imposed on the applicant which was to be within the range of minimum one-fifth of the tax not paid and maximum up to three times tax not paid as prescribed in the Section itself - The adjudicating officer had imposed the appropriate minimum penalty after considering all the facts, circumstances and submissions of the applicant as made - Therefore Commissioner (Appeals) has rightly upheld the imposition of said penalty. Applicant had deliberately contravened the provisions of Section 38(3) of Finance Act, 1979 (FTT) - For these contraventions, the applicant was now circumventing the basic truths and for these contraventions the department had very rightly imposed the minimum penalty as mandatorily prescribed in the Section itself – The conclusion of the Government finds support from the judgement MALAYSIAN AIRLINES Versus UNION OF INDIA [2010 (8) TMI 786 - BOMBAY HIGH COURT] – Decided against applicant. - F. No. 375/24/FTT/10-RA - 237/2012-Cus.(FTT) - Dated:- 29-5-2012 - Shri D.P. Singh, J. REPRESENTED BY : S/Shri M.J.S. Ruppal and Jitender Kumar, Advocates, for the Assessee. None, for the Department. [Order]. - This revision appl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 952/- and imposed a penalty of Rs. 9,02,000/- under Section 38(3) ibid for the above contraventions. 2.1 On being aggrieved of above orders of original authority, the applicant filed appeal before Commissioner of Customs (Appeals) who rejected the same. Aggrieved from the said order of Commissioner of Customs (Appeals) the Applicant, filed the Appeal No. 525-SM before the Customs, Excise and Service Tax Appellate Tribunal. The Hon ble Tribunal vide its Order No. 1451/2008-SM(BR), dated 6-11-2008 [2009 (240) E.L.T. 735 (Tri. - Del.)] set aside the impugned order dated 29-4-2008. However, the said order dated 29-4-2008 passed by the Customs, Excise and Service Tax Appellate Tribunal was challenged by the Respondent department before the Hon ble High Court of Delhi in Appeal No. CUS.A.C. No. 1 of 2009. The appeal filed by the Respondent was on very limited aspect of law i.e. :- Whether the Customs, Excise and Service Tax Tribunal (CESTAT) had jurisdiction to hear the appeal filed by the Respondent (Appellant herein) against the order passed by the Commissioner (Appeals) under Rule 11 of the Inland Air Travel Tax Rules, 1989. The Hon ble Delhi High Court vide it s order dated 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ong. Besides this it alleges non-payment within 30 days and delay beyond the said period, which is also ex-facie incorrect because the payment of the correct amount has been made within 30 days. Thus on this count also no action could be taken on the basis of the Show Cause Notice. 3.3 Because the Applicant had already made the payment of the actual amount with interest in accordance with Sections 35 and 35A of the Act and the question of invocation of Section 38 when FTT had already been exempted/abolished and thus consequent issuance of Show Cause Notice did not and could not arise at all. 3.4 It is stated that the Assistant Commissioner of Customs (FTT) while passing the order dated 13-10-2005 has failed to appreciate that Section 35(2) of the Act contemplates deposit of FTT by the carrier according to Rules. Rule 4 contemplate such deposit then within 30 days and after 2002 within 15 days. Section 35A contemplates payment of interest in case of failure to deposit in accordance with Rules and for the delayed period minimum interest is provided 20%. Therefore it necessarily follows that the deposit of FTT should be made within 15 days and beyond that period with interest. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under Section 35A(1) of the Act ibid read with Notification No. 3/94 dated 12-8-94 because provisions of Rule 4 of the FTT Rules, 1979 ( as amended) were first violated and then complied with by themselves. The exact date of filing the due return for the month of March 2003 is not appearing anywhere in the records before this authority but as stands corrected by lower authorities as well as by the Applicant himself that there indeed was a delay of 2 days and not 3 days as was initially pointed out in impugned Show Cause Notice and corrected in Order-in-Original which finally implies that a delay has indeed occurred in this case matter. 7. Government observes that the Applicant has argued that, they were not accorded due opportunity of three personal hearings before the original adjudicating authority. In this regard Government notes from the impugned Order-in-Original that although the applicant did not avail the opportunity of personal hearings granted on 14-4-2005 and 19-8-2005 but personal hearing did take place on 23-8-2005 and one more opportunity of personal hearing was granted on 14-9-2005 on the request of the applicant s representative that they want to submit certain ci ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the payment of such tax and the interest leviable thereon, be liable to pay penalty which shall not be less than one-fifth but which may extend to three times of the amount of the tax not so paid to the credit of the Central Government. These provisions for Inland Air Travel Tax and Foreign Travel Tax collection are similar. In the case matter under reference the Government here cites and discusses Hon ble High Court of Delhi judgment dated 12-8-2009 in W.P. No. 10835 of 2009 in the matter of IATT, of Jet Airways (I) Ltd. v. U.O.I. Others. In the said case, Government had passed Government of India Order No. 73/2009 dated 12-5-2009 for similar contraventions in almost identical situation by Jet Airways (I) Ltd. wherein Government had upheld the order passed by Commissioner (Appeals) imposing penalty under Section 46(3) ibid, equal to one fifth of amount of tax not so paid to the credit of Central Government. The said order was challenged by the party in Hon ble High Court of Delhi, who in its judgement dated 12-8-2009 while upholding sanctity of imposed separate penalties under Rule 8A(3) of IATT Rules, 1989 and Section 46(3) of the Finance Act, 1989 relating to IATT uphel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t Hon ble High Court of Bombay while dismissing the Writ Petitions has observed on the issue as under :- Para 49 It is well settled principle of law that in case of a conflict between a substantive Act and delegated legislation, the former shall prevail in as much as delegated legislation must be read in the context of the primary/legislative Act and not the vice-versa. Para 52. The provision of Chapter-V of the Act in general and section 38(3) in particular provides that every carrier or other person, who fails to pay the FTT to the credit of the Central Government under sub-section (2) of section 35, in addition to payment of such tax and the interest leviable thereon, is made liable to pay penalty. The said provision shows the mandatory nature of payment of liability. The use of the word shall in the statute, ordinarily speaking, means the statutory provision is mandatory. .. .. Para 54. .. Therefore, there is no need to establish proof of criminal motive or any mens rea on the part of the defaulter. It is not an essential element for imposing penalty under the Act and rules framed thereunder. Para 61 .. If any person fails to pay within the stat ..... X X X X Extracts X X X X X X X X Extracts X X X X
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