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TMI Blog2019 (1) TMI 70X X X X Extracts X X X X X X X X Extracts X X X X ..... in his order on duty liability of the appellant applicable with effect from 01.07.2012, having regard to extension of cum tax benefit as provided under section 67(2) of the Act. Penalties under Section 77(2) - Held that:- While reducing penalty from ₹ 20,000 to ₹ 10,000 under Section 77(2) of the Act, the Commissioner (Appeals) has given his reasoning that ₹ 20,000 was maximum penalty prescribed and as appellant was yet to file the prescribed return for which he considered that it would be improper to invoke Rule 7C and Section 70 of the Act to impose maximum penalty by equating the delay in filing with non-filing of return. Since respondent department has not challenged the same reduction of penalty, such reduction of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cial) Shri J.N. Somaiya, Advocate for the appellant Shri Dilip Shinde, AC (AR) for the respondent ORDER Confirmation of duty demand, interest and penalty on washing and ironing services (Dhulai/Estri) by the Commissioner (Appeals) against appellant has been assailed in this appeal. 2. Facts of the case, in a nutshell, is that appellant company is registered as cooperative society and also service provider which has been carrying out activities of washing and ironing of clothes of the customers in its premises on agreed upon charges, duly accounted in its books of accounts. During investigation, central excise officers verified the transactions, recorded statement of the General manager and issued show-cause cum dema ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing that no ST-3 returns were filed, the ld. Counsel for the appellant pointed out that bonafideness of the appellant was apparent since there was no intention to evade payment of service tax especially when up to 03.06.2012 their activities were not taxable and for service provided thereafter also they have not collected any tax from the customer. In citing judicial decision of Bordubi Engineering Works vs. UOI 2016 (42) STR 803 (Guj), K.T. Murukan 2017 (5) GSTL-248 (Ker.) and Uniworth Textiles Ltd. 2013 (288) ELT 161 (SC) he argued that mere omission to pay tax/ file returns by itself cannot establish malafide of the assessee in the absence of independent corroborative evidence in which invocation of extended period is not justified and t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ure was not scrutinised to find out the use of solvent which is most important for the purpose of determination of cleaning procedure and as the washing charges were mentioned in the invoice and same has been stated in the book of accounts, he accepted the submissions of the appellant that washing of clothes were done in washing machine with the help of water and washing powder/ liquid for which he held that service given by appellant before 01.07.2012 is not taxable but as negative list under Section 66D or mega exemption Notification no. 25/2012-ST have not contained the name of services provided by the appellant, the further period post negative list is taxable. I find no irregularity in his order on duty liability of the appellant appli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d, collusion, wilful misstatement or suppression of fact have been established since on apprehension of such acts, records can be scrutinised but that does not necessarily mean that when duty liability has arisen the same should not be paid, keeping penalty aspect to be established beyond reasonable doubt by the prosecution itself through cogent evidence for justifying penalty intended to be imposed under Section 78 of the Act. In the instant case the service provided by the appellant was not taxable before introduction of negative list. It was not filing returns on those scores though it was duly maintaining the record. Further if the contention of ld. Advocate is to be accepted, the rural folk of Indian society continue to follow the same ..... X X X X Extracts X X X X X X X X Extracts X X X X
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