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Issues involved: Stay Application for waiver of pre-deposit of Service Tax and penalty under Sections 77 and 78 of the Finance Act, 1994.
Summary: The Appellant filed a Miscellaneous Application for early hearing of the Stay Application along with the Appeal due to a recovery notice issued by the department to their clients and bankers. The Ld.A.R. for the Revenue had no objection for early hearing. The Tribunal allowed the early hearing and proceeded with the Stay Application itself. The Stay Application sought waiver of pre-deposit of Service Tax amounting to Rs. 49.90 Lakhs and penalty under Sections 77 and 78 of the Finance Act, 1994. The Ld.Consultant argued that the Ld.Commissioner(Appeals) did not decide the issue on merit but dismissed the Appeal for failure to deposit the directed amount. The Appellant, engaged in providing taxable services, admitted to a liability of Rs. 14,63,370.51 and had already paid Rs. 6.64 Lakhs. The Appellant disputed the demand of Rs. 49.90 Lakhs and expressed willingness to deposit the admitted liability less the amount already paid. The Tribunal noted that the Ld.Commissioner(Appeals) did not decide the issue on merit and dismissed the Appeal for non-compliance with the pre-deposit direction. The issue involved the leviability of Service Tax on services rendered by the Appellant. The Tribunal found that a pre-deposit of Rs. 8.36 Lakhs was sufficient to hear the Appeal, directing the Appellant to make the deposit within eight weeks. The matter was remitted to the Ld.Commissioner(Appeals) for fresh consideration without insisting on further pre-deposit. Both parties were allowed to adduce evidence, and the Appeal was allowed by way of remand.
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