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TMI Blog2023 (12) TMI 310X X X X Extracts X X X X X X X X Extracts X X X X ..... y act. What has been agreed by the appellant is, commitment of performance towards the machines supplied by them in case those perform subdued as per the standard committed performance. The alleged tolerance, in the given circumstances, is possible on the part of the receiver of machines. Hence, the question of tolerating any act by the appellant does not at all arise. The Appellant, therefore, cannot be held liable for rendering any declared service as defined under section 66E (e) of Finance Act, 1994. The findings to that extent of order under challenge are therefore, not sustainable and are thus liable to be set aside. Levy of penalty - HELD THAT:- It is held that the admitted facts on record and the findings above are sufficient t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tors/vendor of contract drill. Department formed an opinion that the appellants have tolerated the situation and thus are covered under the ambit and scope of declared service as provided under section 66E (e) of the Finance Act, 1994. Resultantly, vide show cause notice F.No.III(10)A-IND/37/CE/Gr.15/C-IV/Kores/18-19/1842 dated 18.02.2020, the service tax amounting to Rs.4,43,663/- on the amount of Rs.29,57,753/- was proposed to be recovered alongwith interest and appropriate penalty. The proposal was confirmed initially vide Order-in-Original No.08/ST dated 31.03.2021, the appeal against the said order has been rejected by the Commissioner (Appeals) vide Order-in-Appeal No.IND-EXCUS-000-APP-97-2022-23 dated 27.02.2023. Being aggrieved, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ve been on part of the receiver of machines supplied by the appellant. Seen from all of the above submissions, the demand under question is liable to be set aside. No question for imposition of penalty at all arises for want of any malafide intent on the part of the appellant to evade its tax liability. The order under challenge is, therefore, prayed to be set aside and appeal is prayed to be allowed. 5. While rebutting these submissions, learned Authorised Representative has impressed upon the correctness of the finding in the order under challenge. It is submitted that an amount of Rs.29,57,753/-, as received by the appellant, was booked on account of Other income Receipts Excess Provisions/Balances written back i.e. sundry entry ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... liability to compensate the receiver of machine in case receiver notices any lacuna in the performance of supplied machine within one year thereof. The appellant thus had made provision for the probable future liability towards the supplied machines. The appellant was showing in its record the said agreed 20% of total sale consideration received, as its contingent liability. In case, the appellant was not found liable for the said contingency, the amount was written back as their income in the records. We also observe that the appellant had discharged the excise duty liability on the entire amount of consideration received for supply of machine including the amount in question. 8. In the light of these observed facts but to adjudicate t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o the issue of imposition of penalty, it is held that the admitted facts on record and the findings above are sufficient to hold that there is no liability of payment any service tax on the part of the appellant, the question of evasion, thereof, does not at all arises. Penalty is, therefore, not imposable upon the appellant. The presence of any malafide intent to evade becomes irrelevant in the given scenario. Thus, I hold that there is neither any legal basis nor factual with the adjudicating authorities to penalize the appellant. Resultantly, the order imposing penalty is also held liable to be set aside. 11. As consequence of the above discussion, the order under challenge is hereby set aside. The appeal accordingly stands allowed. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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