CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL, NEW DELHI

PRINCIPAL BENCH - COURT NO. 1
Service Tax Appeal No. 401 of 2007
(Arising out of Order-in-Appeal No. 94/CE/CHD/2007 dated 19.04.2007 passed by the Commissioner of Central Excise (Appeals), Chandigarh).

DATE OF HEARING : 19.12.2007
DATE OF DECISION : 19.12.2007

M/s ACME Tele Power Pvt. Ltd.       -                                     Appellant
(Rep. by NONE)
VERSUS
CCE, Chandigarh                                  -                      Respondent
(Rep by Smt. A.P. Tiwari, JCDR)

CORAM :     HON’BLE MS JYOTI BALASUNDARAM, VICE-PRESIDENT

Imposition of penalty is sustainable when tax liability was paid only after the inquiry was conducted by the Department.  Therefore, there is no merit in the appellants’ contention that the demand of tax together with interest, prior to the issue of the show cause notice, would absolve them of the liability to pay penalty. (Para 2)

O R D E R

PER JYOTI BALASUNDARAM  :

1.             In this case, the entire Service Tax together with interest was paid by the appellants, who were found to have been providing services of Erection, Installation and Commissioning of plant & machinery and equipments.  The appellants challenged the impugned order on the ground that, they were not to pay penalty due to instant payment of tax together with interest [the Commissioner (Appeals) has reduced the tax payment and proportionately scaled down the penalty amount to Rs. 3,97,634/-].

2.             I have heard the learned JCDR for the respondent and perused the record.  None is present for the appellants in spite of notice.  I find that the issue has been settled by this Tribunal in the case of Mett Macdonald Ltd. vs CCE, Jaipur, 2006 (2) STR 524, holding that, imposition of penalty is sustainable when tax liability was paid only after the inquiry was conducted by the Department.  Therefore, there is no merit in the appellants’ contention that the demand of tax together with interest, prior to the issue of the show cause notice, would absolve them of the liability to pay penalty.   Following the ratio of the above decision, I uphold the impugned order of imposition of penalty and reject the appeal. 

(Dictated and pronounced in the open Court on the 19TH day of December, 2007)