2015 (9) TMI 639 - HC - Service Tax

Waiver of pre deposit - Mandatory pre deposit - Section 35F - Held that - Applicability of Section 35 F of the Finance Act is pending consideration before the Hon ble Division Bench of this Court, this Court permits the petitioner to file an appeal along with waiver application, within a period of two weeks from the date of receipt of a copy of this order. Since the matter is pending before the Division Bench of this Court, testifying the validity of Section 35-F of the Finance Act, relating to pre-deposit, the appellate authority is directed to receive the appeal along with waiver application filed by the petitioner, which would be subject to the result of the issue pending before the Division Bench.

Summary

Issues:
Challenge to order dated 26.06.2015 passed by the respondent in C. No.IV/09/478/2012-13 No. 2/2015.

Analysis:
The petitioner, a construction company, challenged a service tax levy order from the respondent. The petitioner claimed they did not collect service tax from customers during 2007-2011 due to a reasonable belief that their activities were not taxable. The respondent issued a show cause notice proposing service tax, which the petitioner contested. The respondent's order confirmed the tax demand, citing a larger period of limitation and retrospective application of an explanation. The petitioner argued against the retrospective application of the explanation, citing settled legal principles and circulars. The petitioner also raised concerns about the demand for a larger period and the implications of a substituted section of the Central Excise Act. The petitioner sought relief through the writ petition.

The respondent argued that the petitioner should file an appeal with pre-deposit as per law, referencing the second proviso to Section 35(F) of the Act. The respondent highlighted that the applicability of Section 35F of the Finance Act was pending before the Division Bench of the Court. The respondent emphasized the need for the petitioner to comply with the pre-deposit requirement for filing an appeal.

The Court permitted the petitioner to file an appeal along with a waiver application within two weeks. The Court acknowledged the pending consideration of the validity of Section 35-F of the Finance Act by the Division Bench. The appellate authority was directed to accept the appeal with the waiver application, subject to the outcome of the issue before the Division Bench. The writ petition was disposed of with no costs, and the connected miscellaneous petition was closed.