2014 (7) TMI 669 - HC - Service Tax

Demand of service tax - Non payment of service tax collected from customers - rent-a-cab service - Extension of time of pre deposit order - Held that - Tribunal has considered the prima facie case and ordered pre-deposit of the entire amount. When the matter was listed for reporting compliance, there was no plea made for extending the time to make pre-deposit, except stating that a writ petition has been filed challenging the conditional order passed by the Tribunal. The Tribunal considering the fact that in the writ petition this Court has not granted any stay of order, dismissed the appeal for non compliance of the conditional order of pre-deposit. The said order passed by the Tribunal is justified, as this Court in the writ petition has not granted any stay of the conditional order passed by the Tribunal. No extension of time is sought for and the order has not been complied. No reason to differ with the view taken by the Tribunal - No substantial question of law arises - Decided against assessee.

Issues Involved:
1. Direction to pre-deposit service tax amount for hearing appeal.
2. Justifiability of the Tribunal's order in directing pre-deposit.
3. Impact of pre-deposit on the appellant's right of appeal.
4. Interpretation of the definition of rent-a-cab scheme under the Finance Act, 1994.
5. Non-compliance with pre-deposit order leading to appeal dismissal.

Analysis:

1. The appellant contested a service tax demand related to a Rent-a-Cab scheme, challenging the order of the Customs, Excise and Service Tax Appellate Tribunal. The Tribunal directed the appellant to pre-deposit the entire service tax amount for the appeal hearing, while waiving penalties and interest. The appellant raised substantial legal questions regarding the validity of the Tribunal's order, the justification for pre-deposit, the impact on the right of appeal, and the interpretation of the rent-a-cab scheme definition under the Finance Act, 1994.

2. The Tribunal confirmed a service tax demand against the appellant for two periods, totaling a significant amount. Despite the appellant's arguments, the Tribunal found no grounds for waiving the pre-deposit requirement. The Tribunal's decision was based on the appellant's failure to demonstrate a case for waiver, leading to the direction to pre-deposit the entire service tax amount within a specified timeframe. The Tribunal emphasized the appellant's collection of service tax but non-depositing with the Government, supporting the pre-deposit order.

3. The matter was brought before the High Court due to non-compliance with the Tribunal's pre-deposit order. The appellant's plea for extension based on a pending writ petition was rejected by the Tribunal, leading to the dismissal of the appeal for non-compliance with Section 35F of the Central Excise Act. The High Court upheld the Tribunal's decision, noting the absence of a stay on the pre-deposit order by the Court and the appellant's failure to seek an extension for making the pre-deposit.

4. The High Court concurred with the Tribunal's reasoning for the pre-deposit requirement, finding no substantial legal question for consideration. The Court emphasized the lack of stay on the pre-deposit order by the Court and the appellant's failure to comply within the stipulated time. Consequently, the Court dismissed the appeal and the connected miscellaneous petition, with no order as to costs.

In conclusion, the High Court upheld the Tribunal's decision on the pre-deposit requirement, emphasizing the appellant's non-compliance and the absence of a stay on the order. The appeal was dismissed due to the failure to adhere to the pre-deposit directive, highlighting the importance of complying with statutory provisions in such matters.

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