VINAYAGA FINANCIAL SERVICES Vs. COMMISSIONER OF C. EX.

JUDGEMENT

(1.) HEARD both sides. Shri Parameswaran, learned advocate appearing for the appellants states that they have provided the impugned service to M/s. ICICI Bank Ltd. for recovery of loans from the customers of the said bank. The levy of 'Business Auxiliary Service' which covers such activities was introduced in July, 2003 for the first time. The learned advocate states that there was a confusion regarding applicability of the new levy to the appellants and hence for the impugned period beginning from July, '03 till Mar., '04, the appellants did not comply with the service tax law and pay the tax amount and that they had no intention to evade the tax. Subsequently, they have paid the tax amount and the interest after a delay. He prays that the penalty imposed under Sections 76 and 77 of the Act should be partially waived by invoking the provisions of Section 80 of the Finance Act, 1994 since there was a reasonable cause of the appellant's failure to pay the tax during the initial period. I also note that the learned advocate undertakes that no refund will be claimed in respect of penalty of 25% voluntarily paid by them during the proceedings before the original authority.

(2.) HEARD the learned SDR who confirms that the tax and interest amount have been paid by the appellants before the adjudication order was passed and 25% of the penalty amount has been paid later on.