2015 (10) TMI 364 - HC - Service Tax

Waiver of Pre-deposit - Appeal dismissed for non compliance - Held That - Once it is found that the parameters for deciding the application for a pre-deposit condition have been properly applied, no question of law arises for consideration before this Court in an appeal under Section 35 of the Central Excise Act, 1944 - However, time to make pre deposit extended - partial stay granted.

Summary

Issues:
1. Pre-deposit of &8377; 40,00,000/- for entertaining the appeal before CESTAT.
2. Consequential order passed by CESTAT dismissing the appeal for non-compliance of the conditional order.

Analysis:
1. The appellant was directed by the Commissioner of Central Excise to pay a levy of service tax along with a penalty. The appellant appealed to CESTAT seeking stay and waiver. The Tribunal initially ordered a pre-deposit of &8377; 1,13,81,079/-, which was later modified to &8377; 40,00,000/-. The appellant failed to comply with this modified condition, leading to the dismissal of the main appeal by CESTAT.

2. The Tribunal's order directing the pre-deposit was based on a Supreme Court interim order and a prima facie finding that the appellant's contention regarding the nature of services rendered could not be accepted. The High Court held that the Tribunal's decision on the pre-deposit condition was valid. The appellant was given time until 31.10.2015 to make the deposit, and if done, the main appeal would be considered for disposal by 31.12.2015, and the consequential order of dismissal would be set aside automatically.

3. The Court emphasized that the appellant could still argue the nature of services rendered during the final hearing before the Tribunal. The validity of the pre-deposit condition was upheld, and it was stated that once the parameters for deciding the pre-deposit were correctly applied, there was no legal question to be considered under Section 35 of the Central Excise Act, 1944.

4. While the appeal arising from the conditional order was liable to be dismissed, the Court granted the appellant time to make the deposit, allowing them to pursue the appeal on its merits. The judgment concluded by disposing of both Civil Miscellaneous Appeals, granting no costs, and closing the connected miscellaneous petitions.