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TMI Blog2017 (4) TMI 897X X X X Extracts X X X X X X X X Extracts X X X X ..... under section 76 of the Finance Act, 1994, besides imposing Rs. 4000/- as late fee for delay of filing of ST 3 Returns. Against this order, the appellant filed appeal before Commissioner (Appeal) and vide order impugned herein, the Commissioner (Appeals) upheld the same. Hence this appeal. 3. On behalf of the appellant, the Ld. Counsel Shri Vijaya Balan submitted that the appellant did not contest the service tax liability before the Commissioner (Appeals). The contest was confined to the demand of interest and the penalties imposed. The Commissioner (Appeals) did not consider the contentions put forward by appellant and upheld the demand of interest and penalties. 4. It is submitted by him, that levy of service tax was introduced for the first time by Finance Act, 2007. The amendment said that in Section 65 of the Finance Act, 1994 in clause (105), the following sub-clause (zzzz) shall be inserted. As per this insertion "taxable service" means any service provided or to be provided to any person by any other person in relation to renting of immovable property for use in the course or furtherance of "business or commerce". This was later amended by Finance Act, 2010 to read thus: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... would not have been so punishable had the amendment not come into force'. That therefore the penalty imposed is unsustainable. The Ld. Counsel also relied upon the judgment in the case of the CCE Indore V/s Premium Industries Ltd 2009(248) ELT 883 Tribunal Delhi] and Asean Aromatics Pvt. Ltd., Vs. CCE, Chennai [2008 (232) ELT 514 (Tri. Chennai)] and BOC India Ltd., V/s CCE, Bangalore, [2004 (173) ELT 140 (Tri. Kolkata)]. He argued that the demand of interest after 08.05.2010 and the penalty imposed under section 76 as well as late fee imposed under Section 70 are against law. 7. On behalf of the department, the Ld. AR Sh. Nagraj Naik, reiterated the findings in the impugned order. He submitted that the appellant has not paid the service tax during the period covered in the Show Cause Notice. The service tax along with interest was paid only on 28.01.2012 after passing of the adjudication order. The appellant did not pay interest for the entire demand. He has paid interest only for the period from 08.05.2010 to 27.01.2012. The appellant is liable to pay interest for the period prior to 08.05.2010 also. The service of Renting of Immovable Property Services became taxable with ef ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere were clearly judgments, decrees or orders of courts and Tribunals or other authorities, which required to be neutralized by the Validation Clause. We can only assume that judgments, decree or orders etc. had, in fact, held that persons situate like the appellants were not liable as service providers. This is also clear from the Explanation to the Validation Section which says that no act or acts on the part of any person shall be punishable as an offence which would have been so punishable if the Section had not come into force. 8. The liability to pay interest would only arise on default and is really in the nature of a quasi-punishment. Such liability although created retrospectively could not entail the punishment of payment of interest with retrospective effect. 9. It is also to be noted that the Tribunal itself deleted the imposition of penalty imposed by the Commissioner (Appeals) on the appellants on this ground. 10. Besides, if the liability has been created under the amended section by virtue of sub-section (2) of Section 148 of the Finance Act, 2002, it must be given effect to wholly. The section expressly makes the assessee liable under the amended provision t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ity from 16.11.97 to 1st June, 98 only on May, 2000 and consequently he was not liable to pay interest prior to May, 2000 i.e. the date on which the duty was payable. In the instant case the interest has been realized from 16.11.97 which is contrary to law. The appellant is liable to pay interest from May, 2000 onwards. Accordingly I partially allow the appeal with the direction that the appellant will be liable to pay interest from May, 2000. Consequently, I allow the appeal in above terms with consequential relief to appellant. 11. In Asean Aromatics Pvt. Ltd., (supra). The Tribunal observed as under: 2. In the present appeal, the assessee has challenged the demand of interest and the imposition of penalties. The Ld. Counsel has supported the challenge against the penalties by relying on Explanation to Section 132 of the Finance Act, 2001. He has relied on the decision of the apex court in Star India Pvt. Ltd. V/s Commissioner, 2006 (1) S.T.R 73 (S.C.) in support of the assessee's challenge against the levy of interest. We have heard the Ld. JCDR also. 3. After considering the submissions, we note that the erstwhile Rule 173GG had, apart from providing the facility of mo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ex court's ruling, the benefit of Explanation to Section 132 of the Finance Act, 2001 gets extended to interest also. The impugned order gets set aside and this appeal is allowed. 12. In this regard the validation clause in Finance Bill, 2010 is note worthy and reproduced as under: 76. Any action taken or anything done or omitted to be done or purported to have been taken or done or omitted to be done under sub-clause (zzzz) of clause (105) of section 65 of the Finance Act, 1994, at any time during the period commencing on and from the 1st day of June, 2007 and ending with the day, the Finance Bill, 2010 receives the assent of the President, shall be deemed to be and deemed always to have been, for all purposes, as validly and effectively taken or done or omitted to be done as if the amendment made in sub-clause (zzzz) of clause (105) of section 65, by sub-item (i) of item (h) of sub-clause (5) of clause (A) of section 75 of the Finance Act, 2010 had been in force at all material times and, accordingly, notwithstanding anything contained in any judgment, decree or order of any court, tribunal or other authority, a) any action taken or anything done or omitted to be taken o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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