LAWS(CE)-2011-11-63

COMMISSIONER OF SERVICE TAX, AHMEDABAD Vs. USHABEN PUROHIT

Decided On November 30, 2011
Commissioner Of Service Tax, Ahmedabad Appellant
V/S
Ushaben Purohit Respondents

JUDGEMENT

(1.) REVENUE is in appeal against the impugned order, wherein the penalties imposed on the respondent under Sections 76 and 78 of Finance Act, 1994 were set aside by invoking the provisions of Section 80 of Finance Act, 1994.

(2.) LD . Authorised Representative for the Department submits that in this case the provisions of Section 80 have been invoked on the ground that the assessee is illiterate widow and is not well conversant with the law. He submits that she was filing income tax returns and running business and therefore cannot be said that she is illiterate. Having confirmed the demand for Service Tax invoking extended period, the Commissioner should not have set aside the penalty. Ld. Chartered Accountant, on behalf of the respondent, submits that as soon as the respondent was informed by the Department by way of formal letter that she is required to pay Service Tax, she promptly took registration and in the application for registration, she has indicated that she started business from 6 -7 -2000. This shows the bona fides of the assessee and at no stage there was any intention to suppress the facts with intent to evade tax. During the course of audit also, full co -operation was given and during the verification of books of accounts it turned out that during 2003 -2004, Service Tax has not been paid and this was also promptly paid and is not even contested. As regards income tax returns, he submits that when the service receiver deducted tax at source, she was advised to file income tax return. As soon as she was advised to pay Service Tax, she started paying the same promptly.

(3.) I have considered the submissions made by both sides. I find that the respondents always had the intention to obey the law and whenever she was given correct advice, she followed the same. Further, in the application for registration also, she has given the date of commencement of business. These facts clearly show that omission to pay Service Tax was not intentional and reasonable cause required to be shown under Section 80 of Finance Act, 1994 has been shown. Therefore, the order of the Commissioner (Appeals) setting aside the penalty is proper and does not require any interference.