2015 (7) TMI 469 - HC - Service Tax

Waiver of pre-deposit - tribunal refused to grant stay in respect of penalty and interest - judgmental error - assessee has deposited amount of service tax as per the direction of the tribunal - Held that - The simple arithmetic, which ought to have been carried out by the Tribunal to verify the tax amount and the interest that is required to be paid has not been undertaken by the Tribunal. The Tribunal was carried away with the fact of the petitioner himself paying ₹ 98,14,993/- on 03.11.2014 and thereby assuming that there was a non-compliance of the orders of this Court dated 09.09.2014. Obviously, the factual matrix, which has been set out above does not lead to such conclusion being drawn by the Tribunal as correct. In the facts of the present case and considering the fact that total demanded amount and interest have already been deposited, interest of justice would require to allow the petitioner to avail the right of appeal. - Relief granted - decided in favor of assessee.

Summary

Issues:
Challenge to the final order of the Commissioner, Customs, Excise and Service Tax Appellate Tribunal; Dispute over pre-deposit requirements for appeals; Allegations of non-compliance with High Court orders regarding deposit amounts.

Analysis:
The judgment involves the challenge to the final order of the Commissioner, Customs, Excise and Service Tax Appellate Tribunal, where the petitioner was assessed under the Finance Act for service tax amounts totaling significant sums for different periods. The petitioner filed appeals seeking waiver of pre-deposit as required, which were initially rejected by the Tribunal. Despite making payments, there were disputes over the exact amounts to be deposited, leading to confusion and subsequent dismissal of the appeals by the Tribunal based on perceived non-compliance with High Court orders.

The appellant argued that there was an error in the Tribunal's understanding of the facts, emphasizing that the petitioner was required to deposit only the amounts covering tax and interest, not penalty. The appellant claimed to have deposited an amount exceeding the required sum, contrary to the Tribunal's findings. On the other hand, the Department supported the Tribunal's decision, citing non-compliance with the High Court's order and the subsequent delayed deposit by the appellant.

Upon review, the High Court found no substantial dispute regarding the facts presented. The Court observed that the Tribunal failed to conduct a proper verification of the tax and interest amounts required to be paid, leading to an incorrect assumption of non-compliance based solely on the delayed deposit made by the petitioner. The Court noted that the total demanded amount and interest had already been deposited, indicating compliance with the core requirements despite procedural delays.

Consequently, the High Court allowed the appeal, setting aside the Tribunal's order and restoring the appeals for further consideration. The Court directed the Tribunal to dispose of the matter in accordance with the law, ensuring a fair opportunity for both parties. It was clarified that the deposited amounts would be subject to the appeal outcomes, with no additional costs imposed. Any pending miscellaneous petitions were to be closed accordingly.