2016 (6) TMI 361 - HC - Service Tax

Dismissal of appeal - failure to make pre-deposit of ₹ 5 lakhs as per the order of Commissioner (Appeals) - CESTAT declined to interfere - Appellant on subsequent to the dismissal of appeal deposited a sum of ₹ 2 lakhs as pre-deposit and prayed to take it sufficient for a pre-deposit amount for the appeal to be heard on merits - Held that - this court set asides the impugned order of the CESTAT as well as the order of the Commissioner (Appeals). The sum of ₹ 2 lakhs deposited by the Appellant shall be treated as being in compliance of the pre-deposit order of Commissioner (Appeals), which will stand modified to that extent. Resultantly, the Appellant s appeal before the Commissioner (Appeals), Delhi-II shall stand restored to the file and be now disposed of on merits in accordance with law. - Appeal disposed of

Summary

Issues:
1. Appeal against the order of Customs Excise and Service Tax Appellate Tribunal (CESTAT) upholding the service tax demand.
2. Failure to make pre-deposit as per the Commissioner (Appeals) order.
3. Dismissal of the appeal by CESTAT on the ground of impeccable order.
4. Compliance with pre-deposit amount after appeal dismissal.

Analysis:

1. The judgment addresses an appeal against the order of the Customs Excise and Service Tax Appellate Tribunal (CESTAT) upholding a service tax demand of ?10,00,698/- along with interest and penalty for the period 2007-08 and 2008-09. The Commissioner (Appeals) had rejected the appeal due to the Appellant's failure to make a pre-deposit of ?5 lakhs as per the Commissioner's order. The CESTAT also declined to interfere with the dismissal, citing the order as 'impeccable.'

2. The Appellant subsequently deposited ?2 lakhs, which was considered sufficient for the pre-deposit amount. The High Court set aside the orders of CESTAT and the Commissioner (Appeals) and modified the pre-deposit order to consider the ?2 lakhs as compliant. Consequently, the Appellant's appeal was restored before the Commissioner (Appeals) for a merit-based disposal, scheduled for a hearing on 16th May, 2016.

3. The judgment emphasizes the importance of complying with pre-deposit requirements in tax-related appeals and the significance of timely payments to ensure the appeal's consideration on merits. By depositing the required amount post-dismissal, the Appellant was able to revive the appeal process and have the case heard based on legal grounds rather than procedural shortcomings.

4. Overall, the judgment highlights the procedural intricacies involved in tax appeals, the judicial approach to compliance issues, and the court's role in ensuring fair consideration of appeals while upholding legal standards. The decision underscores the need for parties to adhere to statutory requirements and the court's power to modify orders to facilitate the proper adjudication of cases.