2017 (1) TMI 1620 - HC - Service Tax

Restoration of appeal - appeal was dismissed for non-compliance of pre-deposit - Held that - There is no denial of the fact that the amount as ordered by the Tribunal on 13-02-2014 has now been paid. There is also no dispute about the fact that the restoration application is now pending before the Tribunal - crippling the petitioner at this stage may not be in the interest of either of the parties. However, the fact remains that the amount that ought to have been paid by the petitioner by April, 2014, had been paid only after a period of two years - by imposing certain restrictions, the Garnishee orders could be lifted. Appeal restored.

Summary

Issues:
1. Direction sought for disposal of application for restoration of appeal by CESTAT.
2. Non-compliance with order for deposit leading to dismissal of appeal.
3. Issuance of Garnishee orders to third parties who owed money to the petitioner.
4. Imposition of restrictions to lift Garnishee orders.
5. Disposal of writ petition and related directions.

Analysis:
1. The petitioner filed a writ petition seeking a direction for the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) to dispose of the application for restoration of an appeal that was dismissed due to non-compliance with an order for deposit.
2. The Adjudicating Authority had determined the service tax payable by the petitioner, along with additional amounts, interest, and penalties. The petitioner filed an appeal with the CESTAT, but the appeal was dismissed for failing to comply with the deposit condition set by the Tribunal.
3. Subsequently, the Principal Contractor paid the directed amount, leading the petitioner to file an application for restoration of the appeal. Meanwhile, the respondents issued Garnishee orders to third parties who owed money to the petitioner, prompting the petitioner to approach the court.
4. The court acknowledged the payment made by the Principal Contractor and the pending restoration application. While recognizing the delay in payment by the petitioner, the court decided to lift the Garnishee orders with restrictions to ensure the interests of both parties.
5. The court ordered the lifting of Garnishee orders, except for a specified amount to be retained. It directed the Tribunal to dispose of the restoration application within eight weeks and instructed the 4th respondent to keep a certain sum in fixed deposit until the Tribunal's decision, while the 5th respondent was directed to release the full amount payable to the petitioner. The writ petition was disposed of accordingly, with closure of any related pending petitions.