2017 (8) TMI 1463 - HC - Service Tax

Non-compliance with the conditional order - the conditional order passed by the Tribunal on 21-2-2014 has been complied with, though after a period of three years - whether the same can be taken note of to rejuvenate the appeal filed by the appellant? Held that - The appellant in these cases claimed in the first round of litigation that the services rendered by them cannot be brought within a particular classification. The classification dispute went up to the Hon ble Supreme Court. When it was pending in the Hon ble Supreme Court, an amendment came with the retrospective effect, which made the Hon ble Supreme Court to remand the matter back to the Tribunal. Therefore, this is a case where the question of classification itself was in doubt and the matter was travelling back and forth. In such circumstances, the compliance with the conditional order, though belatedly made, can be taken note of. After all, by giving a new lease of life to the appeal, the appellant would only have an opportunity to argue the main appeal before the Tribunal on merits. No damage will be caused to the respondent-Department, by giving an opportunity to the appellant to argue the matter on main appeal. Appeals are disposed of, directing the Tribunal to accept the payment made by the appellant as sufficient compliance with the conditional order, revive the main appeal, and take it up for disposal. The main appeal shall stand revived and the Tribunal may fix a date for hearing and dispose it of, in accordance with law - Appeal dismissed.

Summary

Issues:
Challenging a conditional order passed by CESTAT for waiver and stay, and a consequential order dismissing an appeal for non-compliance with the conditional order.

Analysis:
The appellant challenged a conditional order passed by the Commissioner of Customs confirming a demand of Service Tax. The appellant filed an appeal before CESTAT along with an application for stay. CESTAT granted stay on the condition that the appellant deposits a specific amount. The appellant filed an appeal before the High Court questioning the refusal to grant full waiver. However, the Tribunal later dismissed the appeal for non-compliance with the pre-deposit amount, leading to a second appeal by the appellant.

The High Court noted that the appellant had eventually paid the required amount after three years. The main issue for consideration was whether the compliance with the conditional order, albeit delayed, could revive the appeal. The Department argued against reviving the appeal due to the delayed compliance. However, the High Court found that the nature of the case involving a classification dispute warranted a fresh opportunity for the appellant to argue the main appeal on its merits before the Tribunal.

Consequently, the High Court directed the Tribunal to accept the payment made by the appellant as sufficient compliance with the conditional order, revive the main appeal, and proceed with its disposal. The main appeal was ordered to be revived, and the Tribunal was instructed to schedule a hearing and dispose of the matter in accordance with the law. Any pending miscellaneous petitions in the appeals were to be dismissed, and no costs were awarded.