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2014 (4) TMI 446 - HC - Service TaxWaiver of pre deposit - demand on account of wrongly availing the Cenvat Credit of Inter Usage connection (IUC) charges - Whether the discretion exercised by the Tribunal for complete waiver of pre-deposit is judicious - Held that - Tribunal had recorded that there was a prima facie case in favour of the assessee in view of the decisions of the Chennai and Bangalore Tribunals in BSNL 2011 (2) TMI 791 - CESTAT, CHENNAI and Manipal Advertising Services Pvt. Limited s cases (2009 (10) TMI 434 - CESTAT, BANGALORE). In such a situation, the order of the Tribunal waiving of the pre-deposit in the case of BSNL-respondent cannot be said to be erroneous or perverse in any manner. - Decided against Revenue.
Issues:
1. Appeal under Section 35G of the Central Excise Act, 1944 against the order of the Customs Excise and Service Tax Appellate Tribunal, New Delhi. 2. Questions of law regarding safeguarding revenue's interest, waiver of pre-deposit, and justification of the Tribunal's order. 3. Disallowance of Cenvat credit by the revenue, show cause notice, penalties imposed, and appeal by the assessee. 4. Tribunal's decision to grant full waiver of pre-deposit and stay further proceedings. Issue 1: The appeal was filed by the revenue under Section 35G of the Central Excise Act, 1944 against the order of the Customs Excise and Service Tax Appellate Tribunal, New Delhi. The substantial questions of law raised included the correctness of the Tribunal's decision regarding safeguarding the revenue's interest under the provisions of Section 35-F of the Central Excise Act, 1944. Issue 2: The second question of law pertained to the discretion exercised by the Tribunal for complete waiver of pre-deposit and whether it aligned with judicial precedent and the law established by the Supreme Court of India. The revenue contended that the Tribunal's reliance on judgments from other Tribunals was misplaced, and no hardship was demonstrated by the assessee. Issue 3: The dispute revolved around the disallowance of Cenvat credit by the revenue, leading to a show cause notice for recovery of inadmissible credit along with interest and penalties. The assessee had filed an appeal challenging the order, and the Tribunal granted full waiver of pre-deposit based on previous judgments from Chennai and Bangalore Tribunals. Issue 4: The Tribunal's decision to grant full waiver of pre-deposit and stay further proceedings was based on finding a prima facie case in favor of the assessee, as supported by the decisions of the Chennai and Bangalore Tribunals. The High Court upheld the Tribunal's order, stating that the revenue's arguments regarding distinguishability of cases would be examined during the final hearing. In conclusion, the High Court dismissed the appeal by the revenue, emphasizing that the Tribunal's decision to grant full waiver of pre-deposit was justified based on the prima facie case in favor of the assessee as per the decisions of the Chennai and Bangalore Tribunals. The Court directed expedited hearing of the appeal while rejecting the revenue's arguments against the Tribunal's order.
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