2014 (2) TMI 197 - AT - Service Tax

Waiver of pre deposit - Demand of service tax - Management, Maintenance or Repair Service of a National Highway median - Held that - there is no prima facie case against the demand barring the demand of Rs. 55,96,089/-. In other words, no prima facie case has been made out against demand of service tax and education cesses totaling to approximately Rs. 1.2 crores. In the absence of evidence of financial hardships, the appellant directed to pre-deposit - Conditional stay granted.

Summary

Issues:
- Waiver and stay against demand of service tax, penalties, etc.
- Contesting the demand raised in the show-cause notice.
- Accrual basis versus actual receipts basis for demand quantification.
- Plea of time-bar and financial hardships.
- Pre-deposit amount and compliance deadline.

Waiver and Stay Against Demand of Service Tax, Penalties, etc.:
The appellant sought waiver and stay against the demand of service tax, penalties, and other charges totaling over Rs. 1.7 crores. The demand breakup included amounts for various services like Management, Maintenance or Repair Service, Sale of Space or Time for Advertisement Services, Renting of Immovable Property Services, and interest on delayed payment. The Tribunal examined the records and found that, except for one component, the demand raised in the show-cause notice was not contested by the assessee. The Tribunal observed that there was no prima facie case against the demand except for the contested amount of Rs. 55,96,089/-. The appellant was directed to pre-deposit Rs. 50 lakhs within 6 weeks to stay the balance dues.

Contesting the Demand Raised in the Show-Cause Notice:
The appellant contested the demand of Rs. 55,96,089/- related to charges for maintenance and repair of a National Highway median. The appellant argued that these charges should not be included in the taxable value of 'Management, Maintenance or Repair Service.' The demand quantification was said to be on an accrual basis rather than actual receipts basis. However, the appellant failed to provide evidence of actual receipts towards Management, Repairs, and Maintenance. Additionally, a plea of time-bar was raised, but the Tribunal was not convinced. The appellant also pleaded financial hardships without supporting documentary evidence.

Accrual Basis vs. Actual Receipts Basis for Demand Quantification:
The appellant raised concerns about the demand quantification being on an accrual basis rather than actual receipts basis. The appellant argued that the demand under the head 'Management, Maintenance or Repair Service' was not based on actual receipts. However, the Tribunal noted the lack of evidence to support this claim, as the appellant could not furnish actual receipts towards the mentioned services.

Plea of Time-Bar and Financial Hardships:
The appellant raised a plea of time-bar and financial hardships. The appellant argued that the demand under 'Management, Maintenance or Repair Service' was time-barred and also claimed financial hardships. However, the Tribunal did not find the plea of limitation convincing, as there was no supporting documentary evidence for the claimed financial hardships.

Pre-Deposit Amount and Compliance Deadline:
The Tribunal directed the appellant to pre-deposit an amount of Rs. 50 lakhs within 6 weeks and report compliance to the Deputy Registrar by a specified date. The pre-deposit was a condition for waiver and stay in respect of the balance dues. Failure to comply with the pre-deposit requirement would result in no waiver or stay against the remaining demand of service tax and education cesses.