2016 (4) TMI 692 - AT - Service Tax

Waiver of pre-deposit - Demand raised under the category of Commercial and Industrial Services whereas according to the latest ruling of the Supreme Court, the said activities would fall under the Works Contract Services - Held that - appellant agreed that there is no undue financial hardships on their part so as to satisfy the conditions of Section 35 F of the Central Excise Act. Accordingly, the appellant is directed to deposit ₹ 1.05 crores within a period of 15 days.

Summary

Issues:
1. Challenge to the direction of deposit in stay order.
2. Interpretation of services provided under different categories.
3. Liability for service tax under Works Contract Services.
4. Financial conditions of the appellant for deposit.

Analysis:
1. The appellant challenged the direction to deposit a specific amount based on the issue of abatement and time bar, but the High Court remanded the matter for fresh consideration following a previous order in a different case.

2. The High Court's earlier order in a different case focused on the appellant's liability as a sub-contractor, while in the present case, the appellant argued that they provided Works Contract services, not Commercial and Industrial Construction Services, which emerged after June 1, 2007.

3. The Revenue argued that the appellant previously claimed services as Works Contract but sought relief based on providing services to a charitable organization. The Tribunal did not favor this plea. The classification of services under Works Contract Services would still entail liability, as confirmed by lower authorities.

4. Considering the latest Supreme Court ruling, the Tribunal found that the appellant provided taxable services, which may fall under Works Contract Services. The appellant agreed to deposit an amount within a specified time frame, with a warning of appeal dismissal for non-compliance due to past dilatory tactics.

This detailed analysis covers the various issues addressed in the judgment, including challenges to the deposit direction, interpretation of service categories, liability under Works Contract Services, and the financial conditions impacting the deposit decision.