ANEJA PROPERTY DEALER Vs. CCE

JUDGEMENT

(1.) THE relevant facts of the case, in brief, are that the Appellants were engaged in providing services under the category of "Real Estate Agent" services. It was found that the Appellants did not pay the tax for the period October, 2004 to December, 2005 and also failed to obtain registration. The Appellants immediately deposited the tax upon detection by TR -6 Challan dated 10.2.2006. A show cause notice dated 21.4.2006 was issued to confirm the demand of tax and to appropriate the amount as deposited by them and also to impose penalty along with interest. The Appellants after receipt of the notice, deposited the penalty of 25% of tax on 8.8.2006 in terms of Section 73(1A) of the Finance Act, 1994. The Adjudicating Authority confirmed the demand of tax of Rs. 2,84,594/ - and appropriated the said amount as deposited by them and also imposed penalty of Rs. 1,00,000/ - under Section 76, Rs. 1000/ - under Section 77 and Rs. 71,149/ - under Section 78 being 25% of tax and appropriated the said amount as deposited by the Appellants. The Commissioner (Appeals) upheld the Adjudication Order.

(2.) AFTER hearing both the sides, it is seen that Section 73 of Finance Act, 1994 provides recovery of service tax not levied or paid or short levied or short paid or erroneously refunded. Sub -section 1(A) of Section 73 of the Act was inserted by Finance Act, 2006 w.e.f. 18 April, 2006, which reads as under:

(3.) I find force in the submission of the ld. Advocate. The Larger Bench of the Tribunal in the case of Atma Steels Pvt. Ltd. and Ors. v. CCE, Chandigarh and Ors. reported in 1984 (17) ELT 331 (Tribunal -LB) held that for issue of a show cause notice either for short levy or non -levy, the recourse can be had to be provisions as prevailing at the time of initiation of proceedings and the period of limitation for issue of show cause notice in spite of the fact that short levy or non -levy referred to the period when different period of limitation was available. The Division Bench of the Tribunal in the case of Mahakoshal Beverages Pvt. Ltd. v. Commissioner of Central Excise, Belgaum reported in 2007 (6) ELT S.T.R. 148 (Tribunal -Bang.) held that demand can be confirmed in accordance with provisions of law at the time of its issuance. In the present case, the new provisions of Section 73(1A) of the Act is in existence at the time of issuance of show cause notice. So, Section 73(1A) of the Act is applicable herein. In view of that, I find that the Applicant deposited the tax, interest and penalty of 25% of the tax within 30 days of the receipt of the show cause and in terms of first proviso to Section 73(2) of the Act where such person has paid the service tax in full together with interest and penalty of 25% of the tax within 30 days of the receipt of the notice, the proceedings shall be deemed to be concluded. Hence, the penalties under Section 76 and 77 on the Appellant are not sustainable and accordingly, it is set aside. The appeal is allowed with consequential relief.