1. When the matter was called none appeared on behalf of the respondents in spite of notice. Notices issued to the respondents were received back with the postal remarks 'Left'. Therefore, appeals are being taken up for hearing in the absence of the respondents. Since the issue involved is common, both the appeals are taken together.
2. Heard learned SDR. Revenue filed these appeals against the impugned orders whereby penalties imposed under Section 76 of the Finance Act were set aside on the ground that there was no proposal in the show cause notice to impose penalties under the said section. Penalty under Section 76 of the Finance Act was set aside on the ground that amount of service tax along with interest had been paid prior to issuance of show cause notice.
3. Learned SDR submitted that in the show cause notices there were specific proposal to impose penalty under Section 77 of the Finance Act. I have gone through show cause notices and I find that there was specific averment as to why penalty should not be imposed under Section 77 & 76 of the Finance Act. In view of this finding of the Commissioner (Appeals) that there was no proposal to impose penalty under Section 77 of the Finance Act is not sustainable, hence, set aside.
4. In respect of setting aside of penalties imposed under Section 76 contention is that the Commissioner (Appeals) relied upon the decision of the Tribunal wherein facts are different. The Commissioner (Appeals) relied upon the decision in the case of Sieger Spintech Equipments Pvt.
Ltd. v. CCE Coimbatore reported in 2006 (3) STR 736 (Tri.-Chennai). In the case the Tribunal has followed its earlier decision in the case of CCE Mumbai v. Top Detective & Security Services Pvt. Ltd. . In the case of Top Detective & Security Services Pvt. Ltd. (supra) finding of the Commissioner (Appeals) was that there was no deliberate intention to evade payment of duty, hence penal action is not warranted. In view of this finding the Tribunal upheld the order passed by the Commissioner (Appeals) setting aside the penalty. Contention in the present case is that there was no such finding in the impugned order and, therefore, setting aside of penalty is not sustainable.
5. In this case penalty under Section 76 was set aside on the ground that duty has been paid prior to issuance of show cause notice. I find that the Commissioner (Appeals) relied upon the decision of the Tribunal wherein finding of the Commissioner that there was no deliberate intention on the part of the assessee to evade payment of duty was upheld. In the present case there was no such finding.
Further, the Tribunal in the case of Mett Machdonalt Ltd. v. CCE Jaipur reported in 2006 (2) STR 524 (Tri.-Del.) held that in case of failure to furnish service tax return in time, penalty under Section 76 & 77 are imposable. Accordingly, appeals are remanded to the Commissioner (Appeals) for afresh decision after affording opportunity of hearing to the respondents. Appeals are disposed of by way of remand.