2009 (10) TMI 451 - AT - Service Tax

Stay- Limitation- Demand is related to the period of July 2004 to January 2006, while SCN issued on 3.1.2000. Contention that issue involved in the earlier proceedings also to be considered. Held that- Department aware of maintenance of software and suppression cannot be alleged. Pre-deposit of balance amount waived.

Summary

Issues Involved:
Waiver of pre-deposit of Service tax confirmed by the adjudicating authority.

Analysis:
The appellant challenged the waiver of pre-deposit of Service tax amounting to Rs. 20,89,72,647/- along with interest and penalties imposed. The appellant contended that they had already deposited a significant amount towards the confirmed demand within the normal period. The issue of the confirmed demand being for the period July 2004 to January 2006, despite the show cause notice being issued on 3-1-2000, was raised. The appellant argued that the nature of their services as consulting engineering services, involving maintenance and repair of software systems, was known to the Department. The Special Counsel raised concerns about the limitation issue, suggesting that it needed further consideration before final disposal.

Upon review of the records, the Tribunal acknowledged the deposit of Rs. 6,29,80,109/- by the appellant, deeming it sufficient to proceed with the appeal. The Tribunal highlighted the significance of the limitation issue, which had been raised in previous proceedings as well. It was noted that multiple show cause notices were issued by the Department on the same issue, indicating their awareness of the nature of the appellant's services. Considering these factors, the Tribunal decided to waive the pre-deposit of the remaining amounts and stayed the recovery until the appeal was disposed of. The Tribunal emphasized the absence of suppression in the Department's knowledge of the software maintenance activity carried out by the appellant.

This judgment by the Appellate Tribunal CESTAT, Bangalore, delivered by Members M.V. Ravindran and P. Karthikeyan, provided relief to the appellant by waiving the pre-deposit of the balance amount of Service tax, interest, and penalties. The decision was based on the adequacy of the initial deposit made by the appellant, the importance of the limitation issue, and the Department's awareness of the appellant's services. The Tribunal's ruling aimed to ensure a fair hearing and disposal of the appeal without undue financial burden on the appellant.