Back
CUSTOM EXCISE & SERVICE TAX APPELLATE TRIBUNAL, NEW DELHI
J.H. Joglekar, J.
Ramesh Chandra Khanna -Appellant
Versus
Collector of Central Excise -Respondent
FINAL ORDER NO. A/540/98-NB AND S/185/98-NB In APPEAL NOS. E/461/98-NB & E/S/453/98-NB
Decided On : 27-05-1998
A.M. Tilak
1. After hearing the appellant, the appeal was admitted for hearing on the ground that the appellant is an individual service tax payer. Revenue having no objection, the case was taken up for final disposal. The appellant is a stock broker, who has not conducted any business during the period 1994 - 1998. This is as per the certificate given by the U.P. Stock Exchange Association Ltd. on 21-1-1998. He was registered for collecting service tax on 5-12-1994. The show-cause notice was issued to him for his failure to file quarterly returns for quarter ending September, 1994. The show-cause notice stated that penalty of Rs. 16,400 was imposable upon him in terms of section 77 of the Finance Act, 1994. The Assistant Collector, however, took a lenient view and imposed a penalty of Rs. 6,000. In doing so, he relied upon the authority vested on him under section 80 of the said Act. The Collector (Appeals), having upheld the lower order, the present appeal is before me.
2. I have heard the appellant in person and the department was represented by Shri A.M. Tilak, Ld. D.R.
3. The service tax was introduced with effect from 1-7-1994. The appellant maintained, at all times, before all officers that since he was not an active member, it was his impression that he was not required to file a return or even to take registration. The registration was taken by him, on being informed by the departmental officers that the registration was mandatory. Thereafter, for the quarter ending December, 1994, he filed a return in terms of section 77 of the said Act in January, 1995. It was possible and necessary for the officers to have advised the present appellant to file a return for the earlier quarter also. In fact sub-rule (2) of Rule (sic) 70 provides for issue of a notice to the service tax assessee, who has failed to file such return. Instead of doing that, the officers chose to issue a show-cause notice and imposed a penalty upon him. This is a situation where the law permitted regularisation of a past error which law was not followed by the departmental officers. On this observation, I allow this appeal and remit the penalty imposed upon the appellant.
