2013 (10) TMI 1215 - HC - Service Tax

Stay Application decided Ex-parte Held that - The observation of the Tribunal that the balance of convenience was against the writ petitioner, is unsupported by reasons - Without going into the question of whether the order ought to have been passed ex parte, the ex parte order set aside without prejudice to the rights and contentions of the respective parties - Tribunal directed to decide the application afresh in accordance with law after giving the petitioner and the department reasonable opportunity of hearing Decided in favour of Petitioner.

Summary

Issues:
Challenge to Customs, Excise, and Service Tax Appellate Tribunal's order on a Stay Petition in a service tax appeal due to absence of petitioner, lack of evidence, and failure to consider prima facie merits of the case.

Analysis:
The writ application challenged an order of the Customs, Excise, and Service Tax Appellate Tribunal, East Regional Bench, Kolkata, regarding a Stay Petition in a Service Tax Appeal. The petitioner claimed that the absence of the person handling taxation matters due to illness caused chaos in the company. The Tribunal decided the stay application in the absence of the petitioner, noting the lack of contract copies, invoices, and evidence of financial hardship. Judicial pronouncements establish that financial hardship is not the sole criteria for pre-deposit dispensation; undue hardship encompasses more than just financial issues.

The Tribunal's failure to consider the prima facie merits of the petitioner's case was highlighted. It is established that if an assessee has a strong case in appeal, pre-deposit should be waived. The Tribunal's observation that the balance of convenience was against the petitioner lacked supporting reasons. The order of adjudication mentioned details of parties, billings, and non-charged Service Tax, which were on record. The ex parte order was set aside, directing the Tribunal to reconsider the application with both parties' participation, ensuring a fair hearing and expeditious resolution within two weeks.

The writ application was disposed of, with the petitioner's allegations not deemed admitted due to the absence of affidavits. An urgent certified copy of the order was to be provided upon formalities' compliance. The judgment emphasized fair consideration of merits, proper hearing, and expeditious resolution in accordance with the law.