2013 (11) TMI 1547 - AT - Service Tax

Waiver of pre deposit - Held that - company ceased the operation and they failed to take steps in the matter. Superintendent of Service Tax informed them the issue of the order and they have collected the order from the Office of the Commissioner, Service Tax - Partial stay granted.

Summary

Issues:
Delay in filing appeal, waiver of pre-deposit of Service Tax, failure to respond to show cause notice, financial hardships leading to cessation of business.

Delay in filing appeal:
The applicant filed a COD application for condonation of a 6-day delay in filing the appeal. The tribunal, after considering the reasons provided in the application, allowed the COD application and condoned the delay.

Waiver of pre-deposit of Service Tax:
The applicant sought waiver of pre-deposit of Service Tax amounting to Rs. 4,36,60,430/- along with interest and penalty for the period October 2004 to December 2008. After hearing both sides and examining the records, the tribunal directed the applicant to deposit Rs. 40,00,000/- within 6 weeks. Upon compliance with this directive, the pre-deposit of the balance amount of tax, interest, and penalty would be waived, and the recovery stayed during the pendency of the appeal.

Failure to respond to show cause notice:
The impugned order revealed that a show cause notice was issued on 19-4-2010, to which the applicant did not file a reply or appear for the personal hearing despite multiple opportunities. The tribunal noted the failure to take steps in the matter, citing that the company ceased operations and was informed of the order by the Superintendent of Service Tax.

Financial hardships leading to cessation of business:
The tribunal considered the financial hardships faced by the applicant due to the cessation of business. In light of this, the tribunal directed the applicant to deposit a specified amount within a stipulated timeframe, with the balance amount of tax, interest, and penalty being waived upon compliance. The recovery of the waived amount was stayed during the pendency of the appeal, with a compliance reporting deadline set for a future date.

This judgment by the Appellate Tribunal CESTAT CHENNAI addressed issues related to the delay in filing the appeal, waiver of pre-deposit of Service Tax, failure to respond to a show cause notice, and financial hardships leading to the cessation of business. The tribunal allowed the COD application for condonation of delay, directed a specific deposit amount within a timeframe for waiver of the balance tax, interest, and penalty, and considered the circumstances surrounding the applicant's failure to respond to the show cause notice. The decision balanced the need for compliance with financial constraints faced by the applicant, ensuring fair treatment in the adjudication process.