CMC LIMITED Vs. COMMISSIONER OF SERVICE TAX

JUDGEMENT

(1.) THE appellant is required to pre -deposit penalty of Rs. 3,84,729/ - imposed by the impugned Order -in -Revision No. 01/2007 Service Tax dated 29.5.2007. The Original Authority had dropped the proceedings in respect of penalty under Section 76 and 78 of the Finance Act which was reviewed by the Commissioner and has imposed penalty. The appellant's case is that on identical issue in another appeal which is listed today for final hearing in appeal No. ST/70/2006, this Bench has granted full waiver of pre -deposit and stayed its recovery. The issue pertains to classification of category of services. The appellant was carrying on computer education services but the department wants to bring these activity under Franchise Services. In Appeal ST/70/2006 of the appellants own case, this bench has given a prima facie finding that the activities carried out by them does not come under the Franchise Services and has stayed the matter. Therefore, the learned Counsel submits that the penalty imposed in the present case is not justified. Moreover, there are several other grounds raised by him to show that the order passed by the Original Authority is correct and the Review Order is not legal and proper and penalty is not imposable as the appellants were initially covered under the Service Tax and were discharging Service Tax from the date it became applicable. He submits that the stay application to be disposed of and the matter be linked up with the one which is listed today for final hearing on another day.

(2.) THE learned JDR opposes the prayer and submits that the Review Order is a correct order imposing penalty. The findings given by the Commissioner is legal and proper. He prays for putting the appellants on terms.

(3.) ON a careful consideration, it is seen that on this very issue this Bench has granted waiver of pre -deposit in appellant's own case by Stay Order No. 716/2006 dated 13.7.2006 in Appeal No. ST/70/2006. The issue prima facie is in assessee's favour and the Order -in -Original not imposing penalty appears to be correct. The stay application is allowed granting waiver of pre -deposit and staying its recovery.