2015 (3) TMI 215 - AT - Service Tax

Waiver of pre deposit - gross errors committed by the Department in the computation of service tax demand - Held that - Even as per appellant s own version in respect of the services provided to two of the entities viz. M/s. Singareni Colleries Company Ltd. and M/s. ONGC Ltd., the service tax liability amounted to ₹ 6 crores. There is no evidence placed before us with regard to the contention that the service tax demand confirmed in the impugned order is incorrect or what is the correct amount of service tax demand that the appellant is liable to pay. In the absence of any such evidence, we are unable to agree with the contention of the appellant that the service tax demand confirmed in the impugned order is incorrect. In the absence of a prima facie case, the financial hardship pleaded by the appellant cannot be accepted for waiver of predeposit of the service tax dues adjudged the appellant - Partial stay granted.

Summary

Issues: Service tax demand confirmation, errors in computation, financial hardship plea, predeposit requirement, waiver of penalty

The judgment by the Appellate Tribunal CESTAT Bangalore involved the confirmation of a service tax demand of Rs. 11,73,95,057/- with interest and penalties by the Commissioner of Central Excise, Customs, and Service Tax. The appellant challenged the demand, claiming errors in computation and financial hardship. The appellant argued that the Department made gross errors and that the amount already paid should be considered sufficient, urging for a waiver of the balance dues. However, the Revenue contended that the appellant failed to point out errors or attend hearings, and thus, a prima facie case for a stay was not made. The Tribunal noted the lack of detailed replies from the appellant and their non-cooperation during hearings. Despite the appellant's financial hardship plea supported by financial documents, the Tribunal directed the appellant to make a predeposit of the entire confirmed service tax demand, excluding the amount already paid, within eight weeks. Compliance was to be reported by a specified date, failing which the appeal could be dismissed without further notice. Financial hardship was considered only for waiving penalties, not the service tax dues. The predeposit of the balance amount would result in the waiver of penalties and a stay on recovery during the appeal's pendency. The judgment emphasized the importance of compliance with the predeposit order to avoid dismissal of the appeal.