RELIANCE ESTATE AGENCY Vs. COMMISSIONER OF CENTRAL EXCISE

JUDGEMENT

(1.) After hearing Shri Sadhu Ram, ld. Consultant for the appellants and Shri S. Bhatnagar, ld. JDR for the Revenue, I find that the appellants have deposited the entire amount of service tax along with interest. The prayer in the application is for dispensing with the pre -deposit condition of penalty amount of Rs. 3,04,020/ - imposed under Section 76 and Rs. 7,000/ - imposed under Section 77 of the Finance Act, 1994. The appellants are registered with the Central Excise authorities for payment of service tax from 16 -10 -98. However, during the period 19 -2 -2003, the service tax, though collected by them from their customers was not deposited with the Central Excise authorities in time. The delay in deposit of the tax is ranging from 3 months to 6 months. The explanation tendered by the ld. Consultant is that the appellants had to maintain a lavish office and was to incur a lot of expenses for maintaining their status for which purposes, the amount collected by them was utilized.

(2.) Shri S. Bhatnagar, ld. JDR appearing for the Respondent/Revenue strongly opposes the prayer for dispensing with the condition of deposit of penalty amount and submits that the amount having collected by the appellants, from their customers, it was not open to them to keep the same for so long before depositing with the Revenue authorities.

(3.) I have heard the submissions made by both the sides. The ground on which the ld. Consultant has prayed for allowing their stay petition is not justified that they did not deposit the service tax as the appellant is a big property dealer and has to maintain a lot of staff for the business for which he had to incur expenses but as there was slump in the market tax could not be deposited with the authorities. However, I do not find any justifiable reason in the above arguments of the ld. Consultant. Admittedly, the tax having been collected by the appellants from their customers, the same was required to be deposited with the authorities within time. It is not a case where the appellants were new licensee or the tax was imposed for the first time in recent past and as such they were not aware of their liabilities. No financial hardship has been pleaded by the appellants. On the contrary, it has been found that the appellant is maintaining a lavish office and has employed a large number of staff. In these circumstances, I think fit to put the appellants to a condition of pre -deposit of an amount of Rs. 1 Lakh towards penalty within a period of six weeks from today. Matter to come up for ascertaining compliance on 28 -12 -2004. (Order dictated & pronounced in open Court on 8 -11 -2004)