VENKATRAMAN ASSOCIATES Vs. COMMR. OF SERVICE TAX, BANGALORE

JUDGEMENT

(1.) THE appellant challenges the order of the Commissioner dated 27 -2 -200 (sic), made under the provisions of Section 84 of Chapter V of the Finance Act, 1994, setting -aside the order of the Assistant Commissioner to the extent that penalties under Sections 76, 77 and 78 of the said Act were waived, and imposing penalties including the penalty of Rs. 90 lacs on the appellant under Section 78 of the said Act.

(2.) THE adjudicating authority had confirmed the demand of service tax to the tune of Rs. 63,78,887/ - and education cess of Rs. 60,274/ - under Section 73 of the said Act, directed appropriation of various amounts deposited towards duty demand, confirmed a further demand of Rs. 5,35,452/ - under Section 73 with a direction to appropriate various amounts paid towards that demand, ordered interest to be paid, and imposed a penalty of Rs. 20,000/ - under Section 78 of the Act.

(3.) THE appellant firm was providing services as architects. On 21 -2 -2005, when their premises were visited by the Revenue officers and the record verified, it transpired that service tax was short -paid for the period from April, 2004 to December, 2004, and that even during the years 2001 to September, 2003 -2004 the tax was short -paid. The adjudicating authority relying upon the statement of the Manager Satish Kumar recorded on 21 -2 -2005, that the service tax liability was not discharged because, the client had not paid the tax and that there was no intention to evade payment of tax, took a lenient view, by imposing a penalty only of Rs. 20,000 under Section 78 of the Act on the appellant.