JUPITER SEA AND AIR SERVICES Vs. CCE

JUDGEMENT

(1.) THE appellants are providers of taxable services. They committed default of payment of service tax for various quarters of the years 1998 - 2001. The tax for this period was paid only on 12.3.2002. The party also did not file ST - 3 Returns within the prescribed time for various half -years of 1999 - 2001. Ultimately they filed returns for these half -years only on 13.3.2002. Subsequently the department issued a show -cause notice to them proposing penalties under Sections 76 & 77 of the Finance Act 1994 for the above defaults. This proposal was contested. The adjudicating authority imposed penalties of Rs. 3,45,293/ - and Rs. 3,000/ - on the assessee under Sections 76 & 77 respectively. The first appellate authority upheld the decision taken by the lower authority with regard to the penal liabilities of the assessee, but reduced the quantum of penalty under Section 76 to Rs. One lakh. The assessee is still aggrieved. Hence the present appeal.

(2.) LD . Counsel for the appellants submits that as the tax was paid with interest prior to issuance of show -cause notice any penalty was not imposable on them under Section 76 or under Section 77 of the Finance Act. It is submitted that the delay of payment of tax and that of filing of returns were satisfactorily explained by the assessee, but such explanation was ignored. According to ld. Counsel the benefit of Section 80 of the Finance Act, 1994 was available to the assessee in the facts of this case. He has relied on the Tribunal's decision in Mukund K. Roongta V. CCE - 1999 (107) ELT 38, wherein a penalty imposed on the assessee was set aside in view of an earlier order of the Tribunal. Ld. Counsel also relied on the decision of the Tribunal in Rajinder Kumar Somani V. CCE - 1999 (113) ELT 111. Ld. DR reiterates the findings of the lower authorities and relies on the following decisions;

(3.) THE question now is what should be the quanta of penalties under Sections 76 & 77. Ld. Commissioner (Appeals) has reduced the penalty under Section 76 to Rs. One lakh, in an apparent exercise of discretion. The Revenue is not aggrieved by this exercise of discretion, nor is it the appellant's case that the lower appellate authority did not exercise its discretion on sound principles. This Tribunal does not want a sit in judgment over such exercise of discretion. In the result, the penalty of Rs. One lakh will stand affirmed.