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2010 (2) TMI 822 - AT - Service TaxPre-deposit towards service tax not paid under Commercial or Industrial Construction service rendered - whether OT is transport terminal excluded from Commercial or Industrial Construction service - Held that - Applicant was asked to reverse the entire credit availed on inputs while all other assessees were required to deposit only 8 per cent of the value of the exempted final product (denatured spirit) cleared, no merit in the modification application hence rejected
Issues:
1. Modification of Stay Order requiring pre-deposit of rupees six crores for hearing an appeal against service tax demand. 2. Interpretation of whether service tax is attracted under "Erection, Installation or Commissioning" service in relation to construction activities. 3. Consideration of case laws supporting waiver of pre-deposit based on similar decisions in other cases. 4. Reviewing the Stay Order based on financial hardship and binding judicial authorities. 5. Application of legal principles in deciding the modification application. Analysis: Issue 1: Modification of Stay Order The appellants sought to modify a Stay Order requiring a pre-deposit of six crores for hearing an appeal against a service tax demand of Rs. 28,25,56,180 related to the construction of a gas terminal. The modification application was based on a decision by the Commissioner (Appeals) in a similar case involving a different assessee, IVRCL Ltd., where service tax was not attracted under a different service category. The appellants relied on various case laws to support their claim for waiver of pre-deposit. Issue 2: Interpretation of Service Tax Liability The Tribunal considered whether the construction activity fell under "Erection, Installation or Commissioning" service, which was argued to be exempt from service tax. The Tribunal took a prima facie view that the activity was not exempt and that the gas terminal did not qualify as a 'transport terminal.' The Tribunal noted that the Commissioner (Appeals) decision cited by the appellants dealt with a different activity and did not provide a binding precedent that was ignored in the impugned order. Issue 3: Consideration of Case Laws The Tribunal analyzed the case laws cited by the appellants, which involved instances where waiver of pre-deposit was granted based on similar decisions favoring the applicants in other cases. However, the Tribunal found that these cases did not align with the current situation where a prima facie view had been taken on the merits of the demand against the appellants. Issue 4: Reviewing Stay Order The Tribunal emphasized that modifying the Stay Order would amount to reviewing its own decision, which was not permissible. Citing the judgment of the Hon'ble High Court of Karnataka in a relevant case, the Tribunal highlighted that there was no new claim of financial hardship in the application, and altering the Stay Order was not justified. Issue 5: Application of Legal Principles After considering the arguments and case laws presented, the Tribunal concluded that there was no merit in the modification application and rejected it. The Tribunal reiterated that the case laws cited did not support the appellants' case for waiving the pre-deposit when a prima facie view had been taken on the merits of the demand. In summary, the Tribunal denied the modification application, upholding the original Stay Order requiring the pre-deposit amount for hearing the appeal against the service tax demand related to the construction of the gas terminal.
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