RELIANCE ESTATE AGENCY Vs. COMMISSIONER OF CENTRAL EXCISE

JUDGEMENT

(1.) APPELLANTS filed this appeal against the Order -in -Appeal passed by the Commissioner of Central Excise (Appeals). In this case, the demand of Service Tax of Rs. 3,04,020/ - was confirmed and penalty of the equal amount under Section 76 of the Finance Act was imposed. A penalty of Rs. 7,000/ - under Section 77 of the Finance Act was also imposed.

(2.) THE appellants are not challenging the demand of Service Tax. The appellants are only challenging the imposition of penalties.

(3.) THE appellants filed 7 returns after the due dates. This fact is admitted by the appellants. Section 76 of the Finance Act provides a penalty of Rs. 1,000/ -for failure to furnish the prescribed returns. In this case, the appellants have filed 7 returns after the due date. Therefore, the appellants are liable to penalty under Section 77 of the Finance Act. A penalty of Rs. 7,000/ - was imposed. Therefore, as the appellants filed returns late, I find no infirmity in respect of penalty of Rs. 7,000/ -. A penalty of Rs. 3,04,020/ - was imposed under Section 76 of the Finance Act. The contention of the appellants is that in the impugned order maximum penalty was imposed whereas the discretion of the authorities below is to impose lesser amount of penalty. The appellants relied upon the decision of the Tribunal in the case of Supreme Freight Services and Anr. v. C.C.E., Bangalore reported in 2004 (60) RLT 181. The contention is that due to financial hardship, they could not deposit the Service Tax within time. In the present case, the delay in depositing the Tax is ranging from 3 to 6 months. It is a settled law that the adjudicating authority has discretion to impose lesser amount of penalty where the maximum penalty is prescribed. Keeping in view the facts and circumstances of the case, the penalty is reduced to Rs. one lakh otherwise the impugned order is upheld.