Penalty

Cestat, BANGALORE bench

Bimal Auto Agency

v.

Commissioner of Service tax, Bangalore

T.K. JAYARAMAN, J.

STAY ORDER NO. 559 OF 2007

STAY APPLICATION NO. 128 OF 2007

SERVICE TAX APPEAL NO. 158 OF 2007

JULY 4, 2007

Section 76, read with sections 77 and 78, of the Finance Act, 1994 - Penalty - For failure to pay service tax - In appellant/assessee’s premises, certain banks were operating to provide finance to purchasers of automobiles - Revenue held that by permitting business of banks, appellant had rendered Business Auxiliary Service and, accordingly, demanded service tax from appellant and also required it to pre-deposit certain amount towards penalties under sections 76, 77 and 78 - Appellant did not dispute its liability of service tax and it paid such amount before issuance of show cause notice - Original authority, considering facts of case, dropped penal proceedings exercising its discretion under section 80 - Whether, on facts, there was enough justification for waiver of penalties imposed - Held, yes [Para 4]