Commissioner of C. Ex. and Cus. Vs. General Manager, Telecom, Bsnl - Court Judgment

SooperKanoon Citationsooperkanoon.com/729279
SubjectService Tax
CourtKerala High Court
Decided OnMay-26-2008
Case NumberC.E. Appeal No. 4 of 2006
Judge C.N. Ramachandran Nair and; V.K. Mohanan, JJ.
Reported in2009[14]STR450; [2009]21STT404
ActsFinance Act, 1994 - Sections 75
AppellantCommissioner of C. Ex. and Cus.
RespondentGeneral Manager, Telecom, Bsnl
Appellant Advocate John Varghese, Adv. and; Parameswaran Nair, Assistant S.Gs.
Respondent Advocate V.R. Kesavakaimal, SC
DispositionAppeal allowed
Excerpt:
- code of civil procedure, 1908.[c.a. no. 5/1908]. section 100-a [as substituted by c.p.c. amendment act, 2002]: [v.k. bali, cj, kurian joseph & k. balakrishnan nair, jj] applicability held, section is not retrospective. all appeals filed prior to 1.7.2002 are competent. but subsequent to 1.7.2002 intro court appeals against judgment of single judge is not maintainable. provisions of section 100-a, c.p.c., will prevail over the provisions contained in the kerala high court act, 1959. c.n. ramachandran nair, j.1. the appeal is filed against the order of the customs, excise and service tax appellate tribunal cancelling interest demanded from the respondent under section 75 of the finance act, 1994. the respondent, which is a government department, delayed payment of service tax by four days on account of delay in allotting head of account for payment. learned counsel for the respondent submitted that the amount was deposited in time, but on account of delay in allotting head of account, credit was given for payment only with a delay of four days. whatever be the reason for the belated payment, we find that the provision for interest containing section 75 is mandatory. the tribunal appears to have cancelled the interest on the assumption that the demand made is penalty. however, on going through the impugned order of the additional commissioner, we find that he had waived penalty and the amount of rs. 19,009/- demanded is only in the form of interest under section 75, which is mandatory in nature. learned counsel for the respondent submitted that the amount was also deposited prior to final orders issued by the tribunal. since we find that the tribunal has cancelled the demand treating as penalty, we allow the appeal by cancelling the order of the tribunal and restoring the demand of interest under section 75 of the act. the deposit made will be ad justed towards liability in terms of demand but without charging any interest thereon.
Judgment:

C.N. Ramachandran Nair, J.

1. The appeal is filed against the order of the Customs, Excise and Service Tax Appellate Tribunal cancelling Interest demanded from the respondent under Section 75 of the Finance Act, 1994. The respondent, which is a Government Department, delayed payment of service tax by four days on account of delay in allotting head of account for payment. Learned Counsel for the respondent submitted that the amount was deposited in time, but on account of delay in allotting head of account, credit was given for payment only with a delay of four days. Whatever be the reason for the belated payment, we find that the provision for interest containing Section 75 is mandatory. The Tribunal appears to have cancelled the interest on the assumption that the demand made is penalty. However, on going through the impugned order of the Additional Commissioner, we find that he had waived penalty and the amount of Rs. 19,009/- demanded is only in the form of interest under Section 75, which is mandatory in nature. Learned Counsel for the respondent submitted that the amount was also deposited prior to final orders issued by the Tribunal. Since we find that the Tribunal has cancelled the demand treating as penalty, we allow the appeal by cancelling the order of the Tribunal and restoring the demand of interest under Section 75 of the Act. The deposit made will be ad justed towards liability in terms of demand but without charging any interest thereon.