CCE Vs. PANDEY BHOOTPURVA SAINIK

JUDGEMENT

(1.) NONE represented the Respondent despite notice. The Revenue, who is the appellant in this case, is challenging the order of the Commissioner (Appeals) dated 25.08.2005. The Commissioner had observed that, the penal provisions of Section 76 of the Finance Act would be applicable in those cases where liability to Service Tax had been ascertained in accordance with Section 68 of the Act, on a person, but the assessee fails to pay the same. He, however, found that in the subject case there was no ascertainment of liability under Section 68 of the Act. This lead him to conclude that, invocation of penal provisions of Section 76 of the Act is not justified and the penalty thus imposed was untenable.

(2.) AGGRIEVED by this decision, the Revenue has filed this appeal. The arguments advanced by the learned DR recalls to us the words of Voltaire who had remarked that governments need both shepherds and butchers. He relies upon the Hon'ble Kerala High Court judgment in Assistant Commissioner of Central Excise v. Krishna Poduval reported in 2006 (001) STR 0185, especially para 11, which reads as:

(3.) WHILE going through the order of the Commissioner, we notice the respondent's argument that, the case of the appellant was covered by Section 80 of the Act and thus no penalty under Section 76, 77, 78 and 79 of the Act could be imposed if the assessee could prove that there was reasonable cause for the said failure. The order issued by the learned Commissioner is totally silent about the applicability of Section 80 of the Act in the subject case. In the interest of justice, we consider it necessary that this prayer of the Respondent/assessee is specifically brought to the notice of the lower authorities for their consideration and response as per law. We, therefore, set aside the impugned order of the Commissioner (Appeals) and remand the matter to him to enable him to decide afresh on the question of imposition of penalty under Section 76 in the light of the applicability of the provisions of Section 80 of the Act. While doing so, the grounds brought forth by the respondent/assessee in the context of the provisions of Section 80 of the Act after may be considered. The guidelines available in this regard from the Hon'ble Kerala High Court judgment in Assistant Commissioner of Central Excise v. Krishna Poduval (supra) and other relevant citations in the matter as may be brought to his notice by both the sides may be taken into account while passing his final orders.