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TMI Blog2025 (1) TMI 1213X X X X Extracts X X X X X X X X Extracts X X X X ..... he entire penalty or interest is not paid by the petitioner. The order quoted captures the fact that the amount of Rs.3,19,129/- is also appropriated by the authority during the investigation towards the demand. Therefore, there is nothing today to be paid by the petitioner as long before the SCN, an amount of Rs.20,64,849/- had been paid which is recorded by the authority. The order also records that it was the payment of service tax and interest that was paid by the petitioner and later on account of the proceedings, an amount of Rs.3,19,129/- is also appropriated. The proceedings have gone on only to the satisfaction of the respondents - Department as there was nothing to be paid or recovered from the hands of the petitioner. The proceedings itself were redundant insofar as the principal amount was concerned and the interest is also paid by the petitioner or appropriated by the department from the petitioner. Reference being made to the judgment rendered by the Division Bench of this Court in the case of COMMISSIONER OF CENTRAL EXCISE AND SERVICE TAX VERSUS M/S ADECCO FLEXIONE WORKFORCE SOLUTIONS LTD [2011 (9) TMI 114 - KARNATAKA HIGH COURT], in the circumstance becomes opposit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent who captures in his order, the case of the petitioner. Therefore, to quote the order becomes necessary, it reads as under: "FINDINGS 6. I have perused the case proceedings, show cause notice, reply to show cause notice and relevant documents placed in the file. The issue before me for decision are: (a) Whether the service of construction, installation & maintenance of petrol bunks owned by M/s. HPCL and M/s BPCL are classifiable under the category of 'Works Contract Service' under the provisions of Section 65 (105) (zzzza) of the Finance Act, 1994? (b) Whether the tax not paid/levied is recoverable under Section 73 (1) of the Finance Act, 1994? (c) Whether the service provider is liable for penalty under Sections 76, 77 and 78 of the Finance Act, 1994 I find that Shri Chellappan Prashanthan, proprietor of M/s Sigpac Associates, Keshwapur, Hubli is engaged in the activity of Construction, Installation & Maintenance of Petrol Bunks owned by M/s. Hindustan Petroleum Corporation Ltd., Belgaum and M/s BPCL, Belgaum and Bangalore and has been appropriately classified under the category of 'Works Contract Service' as defined in Section 65(105)(zzzza) of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion for penalty under Section 77 of the Finance Act, 1994. They have also failed to pay service tax payable within due dates prescribed under Section 68 of Finance Act, 1994, accordingly, I hold that the service tax not paid is liable to be recovered along with interest at applicable rates in terms of provisions of Section 73 and Section 75 of Finance Act, 1994. They are also liable for imposition of penalty under Section 76 of the Finance Act, 1994. The late fee demanded under the provisions of Section 70 of the Finance Act, 1994 read with Rule 7C of Service Tax Rules, 1994 and the amount of Rs 16,000/- already paid for non-filing of periodical returns is also liable for appropriation towards the penalty imposable. 8. As regards imposition of penalty under Section 78 of the Finance Act, 1994, I find from the case records that the service provider have responded immediately to the departments letter dated 22.5.2009 seeking details of service provided and payment of service tax. Thereafter, the proprietor responded to the department's letter, discussed the issue with the preventive Superintendent and applied for service tax registration on line. He has not contended for paym ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... recovered from them under Section/s of the Finance Act, 1994 on the above amount. e) I order appropriation of interest of Rs. 3,90,129/- (Rupees Three Lakhs ninety thousand one hundred and twenty nine only) paid during investigation towards the demand at (d) above. f) I impose Penalty on them under the provisions of Section 76 of the Finance Act, 1994 for failure to pay service tax by due dates. g) I impose Penalty of Rs 10,000/- under the provisions of Section 77 of the Finance Act, 1994, for failure to obtain registration within the stipulated time h) I demand Late Fees under the provisions of Section 70 of the Finance Act, 1994 read with Rule 7C of Service Tax Rules 1994, and appropriate an amount of Rs.16000/- already paid during investigation against the demand." 5. A perusal at the order is indicative of an unequivocal fact that after issuance of the show cause notice, the petitioner has paid the entire amount of Service Tax including the penalty, long before the issuance of show cause notice in the year 2009 itself. The show cause notice as observed hereinabove comes to be issued in the year 2013. The proceedings are instituted after the receipt of the entire ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... k. If an assessee does not pay the tax within the stipulated time and regularly pays tax after the due date with interest. It is something which is not pardonable in law. Though the law does not say so, authorities working under the law seem to think otherwise and thus they are wasting that valuable time in proceeding against persons who are paying service tax with interest promptly. They are paid salary to act in accordance with law and to initiate proceedings against defaulters who have not paid service tax and interest in spite of service of notice calling upon them to make payment and certainly not to harass and initiate proceedings against persons who are paying tax with interest for delayed payment. It is high time, the authorities will change their attitude towards these tax payers, understanding the object with which this enactment is passed and also keep in mind the express provision as contained in sub-sec. (3) of Sec. 73. The Parliament has expressly stated that against persons who have paid tax with interest, no notice shall be served. If notices are issued contrary to the said Section, the person to be punished is the person who has issued notice and not the person to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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