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2016 (2) TMI 314 - AT - Service TaxWaiver of pre-deposit - Nature / type of payment made by the assessee - whether the amount of ₹ 82,82,956/- has been paid towards their routine service tax liability or reversal of CENVAT Credit towards their liability under Rule 6(3) of CENVAT Credit Rules, 2004 - Commissioner did not accept the said payment as reversal of credit observing that the said e-payment was in discharge of their liability towards service tax in providing taxable service and in their ST-3 Return, they had never been claimed that the said payment was in discharge of their liability for availing CENVAT Credit on input services used for both dutiable and exempted products. Held that - Considering the fact that the applicant has reversed an amount of approximately ₹ 19.00 Lakhs, it would be appropriate to direct the applicant to deposit an amount of ₹ 50.00 Lakhs keeping in view the interest of Revenue and also in the interest of justice. Consequently, the applicant is directed to deposit ₹ 50.00 Lakhs (Rupees Fifty Lakhs) within eight weeks from today and on deposit of the said amount, balance dues adjudged would stand waived and its recovery stayed during the pendency of the appeal. - Stay granted partly.
Issues: Application for waiver of pre-deposit of service tax and penalty under Rule 15 (3) of CENVAT Credit Rules, 2004.
Analysis: 1. The petitioner sought waiver of pre-deposit of service tax amounting to Rs. 10.73 Crores and an equal penalty imposed under Rule 15 (3) of CENVAT Credit Rules, 2004. The petitioner had already deposited Rs. 1.00 Crore, interest of Rs. 16.27 Lakhs, and penalty of Rs. 3.72 Lakhs against the confirmed demand. The main contention was that the deposited amount should be considered sufficient for hearing their appeal. 2. The Revenue argued that despite the petitioner claiming to have reversed/paid Rs. 82,82,956/- towards their liability under Rule 6(3) of CENVAT Credit Rules, 2004, it was shown in both the original and revised ST-3 Returns as payment towards their routine Service Tax liability. The original relevant portion of the service Tax Return was presented as evidence to support this claim. 3. In response, the petitioner contended that upon recalculation of the alleged service tax liability, the amount was reduced from Rs. 136.00 crores to Rs. 134.00 crores. They provided a reconciliation statement along with the revised service tax return, asserting that there was no double entry concerning the payment of Rs. 82,82,956/-. 4. After hearing both sides and examining the records, the Tribunal observed that the dispute revolved around whether the amount of Rs. 82,82,956/- was paid towards routine service tax liability or as a reversal of CENVAT Credit. The CENVAT Credit statement indicated that the amount was shown as proportionate cenvat credit used in providing exempted services. The Tribunal noted discrepancies in the petitioner's claims and directed them to deposit Rs. 50.00 Lakhs within eight weeks, considering the interest of Revenue and justice. Failure to comply would result in the dismissal of the appeal without further notice.
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