2014 (2) TMI 91 - AT - Service Tax

Recovery of service tax - Interest under section 75 and penalty under section 76 and 78 - Application not filed u/s 35F of the Central Excise Act - Held that - an opportunity be granted to the appellants to file an application for waiver of pre-deposit for reasons to be made explicit by them in their application. We set aside the impugned order and remand the matter to Commissioner (A) to consider the application filed by them and for giving them an opportunity to pre-deposit the amounts in terms of the interim order - where there was no filing of application under section 35F of the Central Excise Act 1994, CESTAT has dispensed with pre-deposit. Tribunal has taken very broader view and held that party should be given opportunity for filing the application under section 35F of Central Excise Act 1994 so that their view could be considered for grant of waiver of pre-deposit - It is fit case need to be remanded back to Commissioner (appeal) for reviewing his Order-in-Appeal in view of conclusions drawn in above Tribunal order - Decided in favour of assessee.

Summary

Issues Involved:
1. Adjustment of Service Tax for the Tax period of April 2009 to September 2009.
2. Dismissal of appeal for non-deposit under Section 35F of the Central Excise Act.
3. Review of Order-in-Appeal due to mistakes in tax demanded and tax deposited.

Analysis:

Adjustment of Service Tax:
The appellant filed its Service Tax return for the period of April 2009 to September 2009, adjusting the tax due which was either paid in full or short. A detailed statement was presented showing tax payable, tax adjusted, tax to be paid, and tax already paid for each month during the specified period.

Dismissal of Appeal for Non-Deposit:
A show-cause notice was issued proposing recovery of service tax, interest, and penalties. The Commissioner (Appeals) rejected the appeal due to non-filing of an application under Section 35F of the Central Excise Act, 1944, for waiver of pre-deposit. The Tribunal emphasized the necessity of an interim order for pre-deposit before dismissing an appeal. As no such order was issued, the matter was remanded to the Commissioner (Appeals) for the appellant to file an application seeking waiver of pre-deposit.

Review Due to Mistakes in Tax Demanded:
The appellant raised concerns about excess payments of service tax in April 2009 and September 2009, leading to discrepancies in tax demanded and tax deposited. The appellant highlighted the potential impact on interest calculations. The Tribunal decided to remand the case back to the Commissioner (Appeals) for a thorough review of the issues raised, including recalculating the tax liabilities and interest payments. The Commissioner (Appeals) was directed to consider the application under Section 35F and take necessary actions within a specified timeframe.

In conclusion, the judgment addressed the adjustment of service tax liabilities, the procedural requirements for appeal dismissal due to non-deposit, and the need for a review based on discrepancies in tax payments. The Tribunal emphasized procedural fairness and the importance of addressing errors in tax calculations to ensure a just outcome for the appellant.