2008 (7) TMI 35 - AT - Service Tax

Rejection of the appeal on the ground of non-compliance of the stay order - appellant submits that the appellant is a proprietary firm and its proprietor had been arrested by CBI and because of this reason there was delay in filing return No financial difficulty has been pleased and apparently the business is continuing - appellant could not clearly state whether the business continued normally when the proprietor was arrested - appellant should deposit 50% of the penalty case remanded

Summary

Issues:
1. Non-compliance of stay order requiring deposit of penalty and interest.
2. Delay in filing return due to proprietor's arrest.
3. Lack of clarity on reasons for non-deposit of balance amount.
4. Requirement for appellant to deposit 50% of penalty as per Commissioner (Appeals) stay order.

Analysis:
1. The appeal was filed against the rejection based on non-compliance of the stay order mandating the deposit of 50% of the penalty and interest. The Service Tax and interest were deposited, but the penalty amount remained outstanding. The Member (Technical) noted this undisputed fact.

2. The appellant, a proprietary firm, cited the arrest of its proprietor by the CBI as the reason for the delay in filing the return. This explanation was presented by the appellant's advocate during the proceedings.

3. The Revenue's representative, the Learned SDR, raised concerns about the lack of clarity regarding why the balance amount was not deposited. The appellant failed to provide a sufficient cause for the non-deposit according to the Revenue's submission.

4. After considering all facts and circumstances, the Member (Technical) opined that the appellant should deposit 50% of the penalty as directed by the Commissioner (Appeals) in the stay order. The appellant was granted four weeks to make this payment and report compliance to the Commissioner (Appeals) either in writing or through Registered Post Acknowledgement Due (RPAD). Upon submission of proof of payment, the Commissioner (Appeals) would proceed to hear the appeal, allowing the appellant an opportunity for a personal hearing and considering their submissions before passing an appropriate order. The appeal was disposed of through remand following these directions.