- (1.) This order shall dispose of Civil Writ Petition Nos. 10790, 10935 and 10964 of 2012 as learned counsel for the petitioner states that all the petitions involve identical facts and issue. However, the facts are being extracted from CWP No.10790 of 2012.
(2.) Challenge in CWP No.10790 of 2012 is to the order dated 23.2.2012, Annexure P.2 whereby penalty has been imposed upon the petitioner. The petitioner is Director of a Private Limited Company i.e. M/s Virindra Buildcon (P) Limited, Ludhiana (in short, "the Company"). The Company is engaged in the business of laying of cable alongside the roads, construction of the tower foundation, showrooms etc. for various companies in telecom sector and also laying of sewerage system in towns for government. During the years 2005- 06 to 2009-10, the Company received payments for providing services. The Company paid service tax amounting to L 71,92,025/- in accordance with Section 68 of the Finance Act, 1994. During audit, it was pointed out that the company had short paid the service tax while claiming abatement under wrong taxable head of the service. Accordingly, a Show Cause Notice dated 22.10.2010, Annexure P.1 was issued to the company for recovery of such service tax alleging that it provided the services under the category of 'Site Formation and Clearance, Excavation and Earth Moving and Demolition Services' instead of 'Commercial or Industrial Construction Services' in order to wrongly avail the abatement of 67% under notification dated 1.3.2006. It was proposed to impose penalty equal to the demand of service tax upon the petitioner. The adjudicating authority vide impugned order dated 23.2.2012, Annexure P.2 confirmed the demand of service tax against the company to the tune of L 1,56,24,251/- alongwith penalties of more than 200% of the amount of Service Tax was levied. Penalty under Section 78 of the Finance Act, 1994 was also imposed upon each of the three directors including the petitioner. Hence the present writ petition.
(3.) Learned counsel for the petitioner submitted that the adjudicating authority had imposed penalty of L 1,56,24,251/- upon the petitioner under Section 78 of the Finance Act, 1994. According to the learned counsel, Section 78 of the Finance Act, 1994 was not applicable and, therefore, order levying penalty upon the petitioner was beyond jurisdiction. Reliance was placed on the judgments of this Court in Hindustan Construction Company Limited v. The State of Haryana and others, 2005 140 PunLR 313and M/s Dee Kay Exports v. Union of India and another, CWP No.8568 of 2010, decided on 26.10.2010 to submit that the writ petition being maintainable, the penalty was liable to be set aside.;