GUNAM TRAVELS Vs. COMMISSIONER OF CENTRAL EXCISE

JUDGEMENT

(1.) THE appellants are Rent -a -Cab operators providing service of cab renting to the needy. Service lax was leviable on this service for the period 1.4.2000 to 31.8.2000, but the party did not pay the tax, nor did they file the necessary tax return (in form ST -3) for the said period. The tax was paid on 7.3.2002. The original authority in its order dated 25.2.2002 confirmed the demand of service tax of Rs. 10,473/ - with interest thereon at the rate of 24% per annum and also imposed on the party penalties of Rs. 10,473/ - and Rs. 500/ - under Sections 76 and 77 of the Finance Act, 1994. The appeal filed by the party against this decision of the adjudicating authority was dismissed by the Commissioner (Appeals). Hence the present appeal.

(2.) HEARD both sides. Ld. Counsel for the appellants is not contesting the demand of service tax. He is not seriously contesting the penalty of Rs. 500/ - either. He, however, submits that the penalty of Rs. 10,473/ - under Section 76 of the Finance Act, 1994 is too harsh in the facts and circumstances of the case. This submission is contested by ld. DR, who submits that having regard to the fact that the tax due to the exchequer for the period April to August, 2000 was paid as late as in March, 2002 and the interest thereon is yet to be paid, it cannot be said that the penalty imposed under Section 76 is harsh.